Operations data are the data points that are generated every meal period in a restaurant that directly affect sales and profitability. Let’s break it down:
- Marketing activities remind your customers that you still exist.
- People come in to eat at your restaurant.
- You serve them food (operations)
- They pay and leave either happy or sad, eager to share their experience with their friends or trash you on Yelp.
Your restaurant’s operations: the food, speed of service, customer service, perceived value, cleanliness, and safety standards all determine how your guests will feel when they walk out of your establishment. Remember we are restaurant operators and operations are our business.
Operations data points are the measurement of our operations. Most operators today are operating on lagging indicator data only. ie. sales, customer feedback, anecdotal information from managers. By the time you get bad customer feedback about a speed of service issue it’s too late, the damage has already been done. Plus think about how many other customers who were affected, but didn’t take the time to give feedback.
Identifying the root of speed of service issues using lagging indicator data only isn’t productive. It’s a trial and error exercise which isn’t a luxury most operators can afford. The cost to acquire a customer is simply to high to gamble on a “fix” that may not work.
Until this time in the restaurant industry it has been next to impossible to capture, organize, and analyze operations data for even a single restaurant location never mind a national chain. There are two main reasons for this, the first is that we aren’t a completely automated business. We are predominantly a human business where people, not automated machines are the means of production. Number two the technology didn’t exist or it was too expensive. With the invention of tablets and smart phones we now have powerful handheld devices that can be used to capture and process insane amounts of data very quickly.
The ability to provide teams with all the data they need, to be able to, perform all the tasks required to ensure they are shift ready, right in the palm of their hand exists today. You can guide teams through real-time corrective actions to ensure issues get corrected before they affect speed of service. Above store leaders can have access to all the data they need to effectively lead and coach their teams.
I will leave you with this thought. As technology becomes more prevalent in the industry, the companies that can identify, test, and implement new solutions more quickly will have a distinct competitive advantage in the marketplace.
Speed of service is one of the most important metrics that are tracked in a restaurant. It has an immense impact on sales. If you’re doing a great job you will maximize sales for your shift. If you aren’t you are losing customers to long lines at the drive thru or register.
It doesn’t make sense to spend the money to acquire a customer just to have them turn around at the last minute and go somewhere else without making a purchase.
In this blog we’re going to focus on employee turnover and how you can still manage speed of service levels and maximize your sales.
Here is the deal:
- Employee Turnover has always been high, but employee tenure is the more important measure to understand. Tenure is how long our employees are staying in their jobs.
- Because the average employee is staying such a short amount of time we have to re-design how we onboard, train, and operate our restaurants to minimize the effects of turnover on speed of service.
- Having access to and using real-time operations data are a key component in reducing employee training costs as well as identifying and remediating issues before they affect speed of service.
7 Shifts, the Scheduling Company, compiled 7 Restaurant Scheduling Stats of 2017. Click on the image below to see the whole infographic. The facts were crazy but these on how long employees on average stay in a job really stood out to me as scary.
High restaurant turnover is an all-encompassing thing, I know this because I’ve lived it. When you have high turnover you don’t have time to think about anything else, you’re constantly engaged in hiring, training, and backfilling positions. All other pro-active things that you want to do for your restaurant get neglected. How can you work on that new menu or special when you have 3 open positions for tonight’s dinner rush. It’s brutal.
The reality is, you have 57 days with a server, 54 days with a cook, and 124 days with your most expensive employee, your manager. These numbers really paint a picture of what restaurant operators are facing.
Now that you see what the average tenure of an employee is; do you still think it is prudent to spend 4 or 5 days on-boarding/training a person that is only going to be around 54 days? That training time for a server/cook could equate to 10% of their entire employment period at a higher than normal hourly wage.
Here is what we have to do in the industry to minimize these effects.
Shift your Training to Focus on Employee Productivity as Fast as Possible
You have an employee that is going to stay 55 days. The difference between 3 to 5 days of initial training is significant. 3 Days of training is 5.4% of their tenure vs. 9% at 5 days. Think about the ROI jump on that employee when you get them productive quicker.
The easiest place to cut training cost is to reduce the initial onboarding and training period. You do it by:
- Cutting all superfluous training out of the curriculum and focus 100% on must-have job role knowledge. Ex: Cooks need to know recipes, servers need to know how to use the POS and steps of service. Get new hires into their stations contributing to sales ASAP.
- Systematize Everything: Anything that is repeatable has to be in a checklist or in-station Job Aid. You can’t spend a second training people how to remember to do a repeatable task. Instead, you need to teach them that there are processes available to guide them through these tasks as they are doing them and how to use these systems.
- Shift to More Daily Training: You have to shift training from a front-loaded multi-day activity and move the non-job role must-have items to a daily format. Pre-shift meetings for all members of the restaurant are a way to still deliver this culture and non-job specific training in a short couple of minute sessions. Repeating this training over time is very effective.
- Simplify as much as you can. For instance, and a lot of people have done this, put allergen, gluten, health information right on your menu. That makes it easy for customers to find out what items they can eat and reduces the amount of training you have to provide FOH employees on the menu. For the BOH, reduce as many steps as possible for prep and in your recipes. Anywhere you can find efficiency without compromising quality, you should make the change. A great example is a lot of quick-service restaurants have assembly cards in the different cooking stations, this helps with consistency but can also reduce upfront training time because there is a job aid right in their station. You have to do that because your employees aren’t around long enough to learn super complex processes.
- Use mobile devices to your advantage: Offer the ability to engage in training and to complete processes on a mobile device. Processes then become simple to manage as everyone is always working off of the latest version of the process. You can’t mandate that employees use their own phones, you have to provide an alternative, but you can allow them to use their devices to make your business better and their jobs easier and more convenient. Treat their devices as a force multiplier.
- Use real-time operations data: Ensure that team members have access to all the data they need to make sure they are shift ready at every location. This includes dynamic corrective actions and job aides for each process. Provide above store leaders with the data they need to hold teams accountable and the ability to lead and coach.
If you follow those steps you will be able to maintain your speed of service levels even in the midst of high employee turnover.
We did a survey and asked over 100 restaurant managers and owners a very simple question. “Do you think your teams are completing their paper checklists accurately?”
94% of those surveyed said that their teams WERE NOT completing their checklists accurately.
I used to think that the industry just didn’t care about pencil whipping. Now after five years in business I realize I was wrong. It’s not apathy, it is a lack of data and visibility into daily restaurant operations.
What is pencil whipping?
Pencil whipping, for our purposes in this blog, is defined as not using and completing a checklist accurately. Pencil whipping includes missed checklists and checklists where the employee just fills it in to get it finished without checking the items as they are supposed to.
What does pencil whipping look like?
The superficial view is the temperature log in a restaurant, hanging on a clipboard, where it is obvious that one person simply went down the list and filled it in day after day. Same pen, same color, same handwriting, the same temperature on all cold hold, and hot hold items.
We have all seen that pencil whipped checklist at some time in our career’s but most of us have never thought about the checklist’s impact on our bottom lines.
What Pencil Whipping actually looks like:
Pencil whipped checklists lead to slower speed of service and lower QSC and Customer Satisfaction scores. This is directly correlated to lower sales and profits.
How much pencil whipping is happening?
Through conversations with our clients and analysis of our own data. We believe that only 25 to 30% of paper checklists are completed accurately.
Which means that 70% of the time, paper checklists are pencil whipped or not completed accurately.
According to Yelp, the average score for all restaurants in the United States is 3.71 out of 5 or 74.2%. Restaurants in America are solid C students according to consumers.
I know that some operators discount Yelp reviews but they are statistically significant and they are the best gauge of what our customers truly think. A 1-star increase in your location‘s Yelp Score can lead to a 5 to 9% increase in sales.
Pilots are famous for using checklists. You can’t turn on a plane’s engine without a checklist. Surgeons also use checklists to make sure they don’t make a catastrophic mistake.
Would you feel safe flying on airplane or getting surgery from a doctor that was only completing their checklists 30% of the time? Why is that ok for restaurants?
The Operators Nightmare
The Operators Nightmare, is when you are doing everything you are supposed to be doing. You are training, investing in your employees, you have systematized everything you can, you have checklists/logs/documented procedures, state of the art technology, great food, and good locations.
Yet your stores feel like they could be doing better and that the day-to-day management of them is just way harder than it should be. You know that something is off but you can’t put your finger on it.
Underperformance in the restaurant industry can be directly tied to pencil whipped checklists. I know a lot of you don’t believe this, and it’s not that I’m incorrect, because I’m not. It’s because if you are using paper you have no data to the contrary and no idea how bad your pencil whipping problem really is.
Paper checklists, which are the most widely used checklist system, are never reported on. It’s simply too arduous to collect all the red books and analyze them and get any real operations data out of them.
Most restaurant executives have never seen any data that would suggest that their restaurants aren’t following their procedures and that by pencil whipping their checklists that it is costing them any money.
We did a study a couple of years ago and we found that in a QSR chicken finger franchisee that had high process compliance, the teams were doing their daily checklists accurately and on time, increased sales by 3.2%, and reduced food cost by 1.2% during that period.
How did this happen you are asking yourselves?
The restaurants ran better or more accurately ran how they were supposed to run. Issues were corrected in real-time before they had a chance to affect guest experiences. This lead to higher QSC Scores and Speed of Service times which led to an increase in sales and at the same time a reduction in comps led to an increase in profits.
Death by 1000 Cuts
The other problem with pencil whipping is that it isn’t a clear cut 1 thing you have to fix. If you have a broken sprinkler pipe, that is a singular problem which you can address and get solved.
Pencil whipping is a singular problem but the symptoms of pencil whipping are not. Pencil whipping shows up operationally as a lot of different things. Refer back to the chart above. Pencil whipping shows it’s ugly head in poor execution on things that were supposed to be handled.
There is nothing more frustrating than a customer having a bad experience at your restaurant because of something that got missed but was part of your training and managed on a checklist that was supposed to be completed before service.
Pencil Whipped Data is Worse than no Data
We have a client that recently made the above comment to us. Pencil whipped data is worse than no data at all. He believes this because he is in Ops Services and he saw the executives of his company making million-dollar decisions on garbage data.
There has always been a lack of good daily operations data in restaurant companies. Especially, large multi-unit operators. Most restaurant companies don’t even have a direct operations data feed that they can analyze.
Restaurant chain executives are forced to back into operations effectiveness at their restaurants by looking at ancillary data: sales, costs, customer satisfaction scores, and if you are lucky audits.
All of those metrics are trailing indicators of operations effectiveness or with the audit a snap shot that is out of date the next day.
Looking at falling sales, higher costs, or bad customer satisfaction scores to identify operational issues is what most of us have had to do. If you are seeing bad indicators in those data sets, it’s already too late.
The goal is not to run bad operations for a long period of time until it finally shows up in a trend line 6 months later when you have done a ton of damage to your brand and those location’s viability.
The goal is to exercise active managerial control over your operations, follow your systems, and avoid bad experiences altogether by executing your systems consistently.
The fact is that we all see the impacts of pencil whipped processes every day in our restaurants and the restaurants that we frequent as guests. We as restaurateurs speak restaurant, we see the stressed employees, the customers having bad experiences, the lost sales, increased costs, and the bad reviews.
We also know that the most successful restaurant companies not only have systems and processes but their culture manages them and holds all team members accountable for following them. Consistent execution of systems is the difference between highly profitable restaurant machines that print money and operations that struggle and barely break-even.
If you work in an organization that is still using paper to manage your operations processes and you would like to fix the biggest nagging issue in your business, please click on the chat icon in the bottom right of the screen and reach out.
I’m going to leave you with this thought.
An employee that pencil whips a checklist is stealing from you. Is there any real difference between taking 10 dollars out of the register or willfully not doing the job you are being paid to do and causing a customer to not come and spend that same 10 dollars at your restaurant? In both cases, you are out $10 dollars.
This hospitality business doesn’t have to be this hard and stressful. You have already figured out what everyone needs to be doing, you just need a better way of managing your team to ensure that they are following your SOP’s.
We have helped thousands of restaurants in 19 countries increase sales, profits, and QSC scores, we can help you.
Customers Will Not Eat at Restaurants that Aren’t Actively Sanitizing and Cleaning
Don’t take our word for it, check out these charts from Datassential and Nation’s Restaurant News.
provided by Datassential
Updating your FOH Sanitation and Operations standards is a must as we start to re-open dining rooms. It’s not going to be enough to just tell people that you are cleaning better for them and expect them to trust you.
Customers are going to need to see proof.
That is easy when they come to the restaurant, they should hopefully see a member of your team cleaning and sanitizing during their stay. They should also witness new operations standards that are meant to protect them and keep them safe. We call this Sanitation Theater.
When someone is at your restaurant they already made their purchasing decision. We need to catch the customer when they are making up their mind’s on where to eat. When they are researching your hours, occupancy, menu, etc.
We need to reach the customer when they visit your website.
At first it will be enough to market your new sanitation standards, changes you have made to our operations, etc.. Everyone should/will have a COVID-19 response page.
Remember back in early march when your inbox was flooded with emails from every company you did business with or whom had your email address. Telling you about their COVID-19 response.
We all felt like, I’m glad that Comcast cares about my safety but they provide me with internet and I have not interacted with a Comcast employee in seven years.
My point is, that having a COVID-19 response page is a must have but is very quickly going to become noise and everyone is going to have one.
We need something more, think McDonald’s.
We need a real-time data feed to document and market your sanitation activities that is constantly updating with what your teams have completed.
Sort of like a billions and billions served message streaming across you website or app, updating in real-time.
We need to let your customers know that you are cleaning and sanitizing all day long, creating a safe environment for them because we care about their health and the health of our team’s We need that data on your website and your app.
Which data should I put on my website? it depends on the size of your business.
For larger chains with more locations, it is better to track the sheer number of sanitation and food safety activities. You can do that on a daily, weekly, or monthly basis.
If you are a smaller business and having completed 20 tasks in a day is not going to wow anyone but is probably going to scare customers away, we need to focus on our cleaning/sanitizing compliance.
We want to wow them with the fact that you are following your procedures and you are completing them in every location on-time.
All of this data is available from the OpsAnalitica Platform. Whether you want to display our reports in your restaurant. Or, for more sophisticated operators you can pull this data right from our API on a schedule and display it anywhere you want to your customers, this is the preferred method.
If you would like to learn more about using OpsAnalitica data to prove to your guests that your restaurant is a clean, safe, and fun environment. Please initiate a chat in the bottom right hand corner of this screen.
Employee & Customer Temperature Checks will Make Restaurants Safer but could also increase Discrimination Claim Risk
The FDA has stated that it would like restaurants to Pre-Screen Employees by taking their temperatures and asking them questions about their potential exposure to COVID-19. For more info check out our blog: The FDA Has Stated that you Should Take Employee Temperatures Before Their Shift
California has starting releasing guidance on new required procedures for restaurants when they re-open. Check out this LA Times Article.
In the article they call out 3 main things:
- Taking customers temperatures
- Waiters wearing gloves and masks
- Disposable menus
Restaurants are going to have to be very careful on how they execute these temperature checks, both for employees and customers.
These restaurants are potentially going to be denying people what they want: a dining experience in the restaurant or a shift to make money based on a temperature reading and the persons answers to a couple of questions.
If the restaurants:
- Do A poor job of communicating their process to their teams and their customers
- Apply their process differently to different people
- Decisions are different for different people when the data is the same
This could open them up to claims of discriminatory practices. You want and need to avoid even the appearance of unfairness at all costs because it could destroy your business.
Restaurants need to have a Employee & Customer Temperature Pre-Screen process that meets these standards:
- Fully Documented
- Applied Evenly
- Takes the responsibility of making the decision off of the manager/employee and puts it on a formula or the process.
OpsAnalitica has developed Pre-Screen Processes, one for Customers and the other for Employees, that guide your manager through the COVID-19 Temperature Pre-Screen. Our processes exceed the 4 standards above.
Watch a quick video to see them in action:
I think it is unavoidable and incredibly unfortunate that some restaurant managers will use these processes to discriminate against employees and customers. Just as I think some customers and employees will claim discrimination when there was none. That is just the world we live in.
The one thing that I do know, is that a well-documented process that is executed fairly will provide the best protection for employees, customers, and restaurant operators.
If you would like to learn more about our COVID-19 processes, please imitate a chat in the bottom right hand corner of this screen.
I was speaking with a buddy of mine yesterday, he is a Franchise Business Consultant for a national burger chain. He mentioned to me that some of his franchisee’s don’t want him in the restaurants right now.
The franchisees don’t want their above store leaders in their restaurants because they don’t want to risk exposing their employees or restaurant to someone that is outside the team and whom could be sick.
I think this is absolutely the correct thing to do. An FBC or Area Manager that is visiting restaurants in their patch, at this time, is more of a liability than a resource. If the FBC/Area Manager is an asymptomatic carrier of COVID-19, and they spread the virus to their restaurants through regular site visits, they could very publicly shut down their entire patch.
Click here to read my blog on the subject: Area Managers Should Stop Visiting Their Restaurants During the COVID-19 Crisis
In response to this dilemma that many FBC’s and Area Manager’s are facing right now, OpsAnalitica has developed our Take-Out/Drive-Thru Scorecard. This scorecard is a scored comprehensive review of the entire take-out/drive-thru experience:
- Starts with how you ordered your food
- Takes your thought the pick-up process
- Paying for the meal
- Looks at Sanitation standards and contactless interactions at the restaurant
- Has you evaluate and rate the food
This scorecard can be used to identify issues in your take-out/drive-thru offering. Because it is scored it can be used to track progress over a period of time. Since take-out and drive-thru are our most important sales channels at this time, it is imperative that we are executing at a high level.
This scorecard is being added to our free COVID-19 resources, which you and your teams can use for Free through May, no strings attached. If you want to take advantage of these resources, just initiate a chat in the bottom right hand corner of this blog, and click on sales.
If you don’t document it, it didn’t happen.
The FDA has recently stated that restaurants should start Pre-Screening their employees and taking their temperatures to determine if the employee is safe to work that shift.
This is an update to current ADA procedures Section 501. This guidance was updated because of the COVID-19 pandemic. I fully expect that this will change when we come out of this pandemic as it did after the SARS pandemic in 2009.
The immediate question is how should you undertake the pre-screening of employees? The larger question is what else should I be documenting around my COVID-19 response.
I’m going to argue that you document all of it.
A lot of you are sighing out loud right now because documentation is boring and a pain in the butt.
Documentation, especially when using a checklist, or checklist program, is very easy to do, because completing a checklist is self-documenting.
I’m growing increasingly concerned that COVID-19 is going to spur a lot of legal actions in the near future. I believe we are not seeing these legal actions today because of the following reasons:
- We are all being asked to stay home and self-isolate.
- We are in the middle of the outbreak and there is no way to figure out where or whom you got COVID-19 from.
- These new guidances, pre-screening of employees, is brand new.
- We haven’t had a chance to see how the negative pre-screen of an employee that is sent home for being ill conflicts with some of the more restrictive labor laws that you see in places like Seattle and California.
- Those will probably be decided in the courts in the next couple of months.
Soon, in the next couple of weeks/months, as we are released from this mandatory self-isolation. We are going to be out and about again and the COVID-19 virus is still going to be very active.
Part of the strategy moving forward to deal with people infected with COVID-19 is going to be the practice of testing, self-isolation, and contact tracing.
I literally heard Dr. Fauci on the daily White House press conference yesterday talking about contact tracing. He was stating that the government will release the stay at home orders when:
- When the virus is not as active in an area
- When they have the medical supplies and hospital bandwidth to handle an outbreak.
- When they have the contact tracing system in place.
Here is a description of Contact Tracing from the World Health Organization. A quick summary of it, is that when you get tested positive for COVID-19:
- Contact Identification: the government asks you to identify all the people you have been in contact with and places you have gone.
- Contact Listing: Identified contacts are added a list and contacted about their exposure to you. They are asked to take the appropriate medical steps.
- Contact Follow-up: people are tracked for symptoms etc..
Once we enter this phase of our COVID-19 response and absent any new laws that state you can’t sue a person for spreading COVID-19, which I don’t know if we’ll see, people are going to be able to trace back where they got COVID-19 from. There will be epicenters at places/events or it will be traced to people who infected a lot of other people.
I think once people can assign blame for getting COVID-19 and quantify their financial losses from being isolated or medical bills. I believe we’ll start to see a lot more law suits around this stuff.
So that is why I’m very much in support of self-documenting your COVID-19 procedures to help protect your business from potential litigation. This can be accomplished by creating checklists and forms to use in your business highlighting your procedures.
Also, remember that with any new process or documentation strategy, consistent execution will always show your commitment and due diligence. It is better to do something less times a day but to do it consistently than to require it be doe more times a day and not have 100% compliance.
Now let’s be clear, my assumption in all of this, is that you are doing the right things to protect your customers, employees, and your brand. If you are and you are documenting those steps as well, it could potentially help you in any kind of government review or legal action.
I’m not a lawyer, if you are concerned you should contact yours, but this just seems logical to me.
How can OpsAnalitica help you with this documentation?
The OpsAnalitica Platform is the ultimate Restaurant Operations and documentation platform. Our goal is always to do the following:
- Take the guesswork out of any process.
- Guide the employee through the process and identify in real-time any remediation actions.
- Act as a self documentation platform, storing all completed checklists digitally for review.
- Notifying management when a process has not been completed or critical violations were detected.
We have created an Employee Health Verification Process that you can use to document your employee COVID-19 Pre Screen questionnaire including the taking of temperatures. Also, we have a Sick Employee and Customer incident forms that you can use to record the actions your took when you identified either a sick employee or customer.
All of these forms are fully customizable and available for free through May of 2020, no strings attached. In addition, we will set your organization up for free so you can take advantage of this system immediately.
If you have any questions or would like to learn more about the OpsAnalitica Platform, please initiate a chat in the bottom right hand corner of the screen.
Episode, 31 – Contactless Payment Is Going To Be A Must Have An Interview With Laurent May From Ready
We recently interviewed Laurent May from Ready To Pay. Laurent discusses the different contactless payment options that are available from their company. He gives you a sense of set-up times and costs as well.
Contactless Payment in the restaurant and a strong take-out presence are going to be Must Haves moving forward. Reducing unnecessary touch points is so important in this COVID-19 world.
Not knowing much about what is available in this space, I was surprised at how much functionality is available. Click here to learn more: www.readytopay.com/Opsanalitica