One of the most transformative changes in the history of the retail/hospitality industry was the invention of the POS System. Replacing the siloed cash register and giving brands real-time access to sales data did more to drive multi-unit operation expansion than any other technology. Prior to wide adoption of POS systems most chains only operated in small areas, not nationally or multi-nationally. Restaurants had only changed by a fraction since the time Jesus ate in them.
The next big transformation in multi-unit operations is going to be operations management systems, like OpsAnalitica, and how the data they generate can be used to run better, more efficient operations.
Before I get into how Operations Management Systems can change your world, I have to tell you about the biggest opponents to these systems. They are dinosaur operators, people who came up before the iPhone, that don’t want to adopt new technologies, are afraid of change, like the old ways, etc..
These dinosaurs don’t understand that operations are sales, operations efficiency increases profits. You can always tell a dinosaur because they don’t view new technology as an enabler, they view it as a threat to the status quo.
Dinosaurs love systems that have huge holes and very low accountability. It allows them to rise through the corporate ladder based on years of perceived experience and not on a track record of results. I’m sure you have worked for or with a person like this, you can always tell because they get great jobs with good salaries but they also don’t stay anywhere for more than a couple of years.
A dinosaur operator views data not as a way to get better but instead as a spotlight on problems. Problems they are aware of, and that have persisted on, because with the current systems they are near impossible to fix. They view data and visibility as the thing that is going to get them fired.
Now dinosaurs aren’t stupid, they will never tell you that data or new technology is bad. They will argue that they are a good idea, but not right now. There are other more pressing issues to solve.
Another common excuse of dinosaur operators is that the team can’t handle any more change right now, they are too slammed with their current stuff.
Be aware of anyone who argues for less visibility, accountability and data. Those are huge red flags, and are tell tale signs of a dinosaur operator.
Back to the topic at hand.
Operations Management Systems, like OpsAnalitica, can be truly transformative for multi-unit operators. Because they, like POS Systems, provide you with real-time visibility, employee accountability, and the ability to change behavior.
In contrast, there has been a ton of buzz around other types of apps or management systems: mobile/web ordering, delivery, better inventory mgt, and LMS’ etc.. These systems generate efficiencies for their users and can reduce waste and time.
I don’t think anyone would say that scheduling software is truly transformative. That mobile ordering is transformative, it’s just another form of call in or web ordering. I’m not saying that those technologies don’t deliver value, they do, I’m saying that they aren’t transformative, changing how you operate your entire business and the financials associated.
If you implement an Operations Management platform in your business and you never go beyond replacing your paper checklists with digital processes then you will be happy, but in all honesty, you won’t see a transformation. The transformation comes from leveraging the technology across your organization, reassessing how you operate, challenging the status quo and norms of your business, then leveraging the technology to drive increased efficiency and change.
At their root, platforms like OpsAnalitica drive behavior and facilitate human data collection. Collecting data from human beings executing processes has always been near impossible, and because of that, businesses just gave up and tried to back into operations efficiency through other metrics: sales, costs, profits, customer satisfaction. Now we live in a world where you can just measure human activity directly and get real-time visibility into operations.
The other thing that was near impossible to do before Operations Management Systems was to control behavior across multiple locations or have the ability to change a process on the fly.
Before OpsAnalitica any change of process was a costly exercise in training an entire organization on the change, developing the materials, having a ton of expensive training meetings, it was so hard that entire management departments like Organizational Change were created. Now with OpsAnalitica, our customers simply go in, update the process, hit save, and it cascades to every location instantly.
We are able to do that because people are used to working processes in our app, our app acts as a constant. When you ask someone to start doing B instead of A. It doesn’t break their brains, they don’t throw a baby tantrum or freak out, they don’t need to go through a 10 hour class to learn about it. They simply do B now. If B is a major change then you are able to provide some context, job aids, links to videos right in the process to help guide the employee through the transition. In most cases that is unnecessary.
To truly transform the industry, companies need to move beyond just doing what they have always done, managing operations with paper checklists that no one ever bothers to check to see that their employees are completing or following them as designed.
Companies need to draw from their best managers, they need to script out every shift, day, week, month, and quarter; focusing on best practices. They need to guide their field employees through the processes of running the business, providing them with job aids and step by step instructions. When an employee discovers an issue, they need to guide that employee through the remediation of that issue in real-time, documenting the issue and solution as they go.
When corporate does it’s job of providing systems, best practices, and support to the field they can better ensure consistent operations and more important consistent guest experiences throughout their locations. Isn’t that what a brand is; a promise of consistency across all locations.
Even more important then great guest experiences is data. Data is sight, it is visibility, it is control. With Operations Management Systems, especially OpsAnalitica, you get data to see how well your managers are performing, but even more importantly, you get to see where you are having issues at the location level. Probably the most important job of any corporate office, who supports field operations, is to help remove recurring issues from daily operations.
When you have thousands of locations and 10’s of thousands of employees and they are telling you that they experience the same problems and those problems are affecting sales, profits, or guest satisfaction. Your job is clear, fix the problem. The real issue is that without an Operations Management Platfrom, corporate almost never hears about these problems internally because there is no easy way to bubble them up to the right people. If these issues are recorded at all, that data is sitting on 1000 clip boards or more accurately in the trash.
We have a client that has 750 locations, and they were getting feedback through their customer service channel that their restaurants were dirty. They didn’t know what to do. They were considering adding 4 more labor hours a day to staff an additional team member to stand around and clean during their busiest periods. Which actually seems like a reasonable solution if that is all the data you have to go off of. That cost would have been around 5 to 7 million dollars a year of additional labor and everything that goes with having those extra hours and employees.
Luckily for that company, they used OpsAnalitica to capture additional data, they crowd sourced solutions from their line employees, they were able to change procedures and A/B test their results, plus they reviewed operations in real-time across the country. The solution presented itself, a bigger trash can. Which, by the way, only cost $20 a piece and solved the problem.
That solution also seems like a no brainer, and it was, when they had more data. That is the value add of an Operations Management Platform. Data. Not just data, but a way to communicate with the field, change procedures, capture even more data, and then bring it together to solve a problem.
They solved this problem, not by guessing or doing the first thing that came to mind, adding millions of dollars of unnecessary cost. They solved it by going through a simple but effective process of elimination and asking the people who knew best, the people in the locations. They solved this problem in 2 and ½ weeks, not 10 months.
Isn’t that what we are all trying to do. Clear out the recurring issues that are affecting our profits and making it harder for our teams to wow our customers. Isn’t that the entire purpose of being in business?
This is where the transformation takes place. When you create a company that can perform problem identification, data collection, crowd sourcing solutions, and can implement changes quickly. When you build that organization muscle, you start to quickly outperform your competitors.
Your competitor that don’t have data and visibility, that would choose option A because there was no other way for them to determine that an option B was a possibility. Companies that add millions of dollars of cost and take months to implement solution. What have they done? They have dissapointed that many more customers and they squandered profits, which you need to grow, to dominate.
When you are efficient and you are exercising Operations Management Platform muscles, you start to win incrementally. All those little wins allow you to start running the tables on your competitors. It starts with more advertising and sales resources, better locations, better access to credit, better access to employees, better access to suppliers, and slowly but surely you start to pull ahead. You are getting end caps and running ads on better shows. Your website is that much better at selling and converting.
I made a bold claim at the beginning of this blog post, that an Operations Management System could be as truly transformative as POS systems to multi-unit locations businesses.
I believe that capturing data from human executed processes in real-time and being able to identify issues, and change processes across an entire organization from corporate is the most significant managerial advancement since the POS and sliced bread.
I know that a lot of you reading this blog have never experienced this kind of visibility or control. Please believe me when I tell you that it will change your world. One of our most active clients in the platform, a multi unit operator with their own locations and franchisees told me recently. Their original plan was to have 3 or 4 food safety and readiness processes in the platform. That is it, a simple replacement for their Red Books.
Now this client has over 80 active processes, the platform is used by more than 5 different departments to help manage their locations: IT, Training, QA, Operations, Accounting, HR all use the platform to direct the locations and keep them compliant. The platform has become the database of the locations and their individual attributes.
This client’s QA department is actively managing their locations and dealing with food safety issues remotely. The OpsAnalitica Operations Management Platform has transformed their business and made them more effective and more profitable.
If this blog has sparked an interest in learning more, sign up for a demo at OpsAnalitica.com. We’ll show you how we can help you transform your business.