Culture as a competitive advantage
For the hospitality sector, “company culture” is more than just buzz words—a great culture is a competitive advantage. In an industry notorious for its turnover, crafting the right culture can attract top talent, while engaging your employees will encourage them to stay.
Disengaged vs. engaged employees
According to a recent Gallup survey, only 34% of employees are engaged, while 51% say they are actively looking for a new job. It is impossible to deliver a genuinely warm and friendly guest experience if the employee is unhappy, unsatisfied, or checked out. In hospitality, where guest satisfaction is critical, low engagement levels translates to low sales.
Disengaged employees exude negative energy which can have a ripple-effect for the rest of your staff, contributing to a toxic workplace culture. At best, they will show up and do the bare minimum. As you may imagine, unengaged employees deliver mediocre or negative customer experiences, directly impacting your bottom line.
In contrast, engaged employees (employees who feel connected to their work, valued, and appreciated) will champion your brand, engage their colleagues, and are less likely to call in sick. And, they are empowered to go the extra mile for guests, delivering outstanding customer experiences and driving sales.
It’s no surprise that companies with engaged employees have higher productivity and profitability. In fact, the Gallup Blog reported that companies that address employee engagement see customer satisfaction rates rise by 10%, while sales increase by an average of 20%.
The cost of turnover
The hospitality turnover rate is many times the national all-sector average. Gallup reports turnover rates as high as 150% in quick-service restaurants and 103% for hourly staff in full-service brands.
Restaurants invest a huge amount of money trying to attract the right talent. Plus, managers spend valuable time vetting candidates and conducting interviews—not to mention training new hires. What does that mean for your bottom line? TDn2K estimates that turnover for a GM costs around $14,000, while Gallup confirms that back and front-of-house replacements cost around $2,000. Multiplied by each of your employees (and then some), you can see how quickly turnover adds up to a massive expenditure.
With constant turnover comes a constant stream of new hires to onboard. Your existing staff feels the strain as well: when new staff aren’t as comfortable with the menu or up to speed on how things are done in your restaurant, it falls on the others to pick up the slack—and the guest experience can suffer.
There’s another cost to turnover: the culture of your restaurant. Maintaining a consistent brand and a positive, thriving company culture is impossible if your entire staff is different one year to the next.
The virtuous cycle of retention
Your restaurant has an opportunity to shift the investment from simply attracting talent to finding the right employees—and then engaging and retaining them.
While competitive pay is necessary, there are many ways to increase employee engagement and retention that cost nothing. By investing your time and effort in the employees you already have, you can break the unvirtuous revolving-door cycle and create a virtuous cycle of retention.
Crafting your culture and engaging employees
- Set the right tone—and get buy-in from your team
Set the vision. It may seem obvious, but the first step in creating a positive company culture is aligning your team around a clear vision for your restaurant. For it to succeed, everyone needs to be pulling in the same direction. Help each employee, from the runners to the dishwashers to the servers to the chefs, see how they fit into this vision and how their role affects the success of the team—and the business.
Define your values. Articulate your company’s values, and make sure that you are helping your team live by them. As the leader, it’s critical that you set the tone and live by them, as well. Leading by example will help these values stick. When values are clear and defined, it also makes it easier to hold team members accountable.
- Hire the right people
A positive workplace culture becomes a competitive advantage for your restaurant, helping it stand out from other opportunities. To attract the right talent, even the job description should reflect your restaurant’s values, culture, and brand.
Make sure that each candidate you consider will fit with your brand values, and will buy in to your mission and vision. Their personality and work-ethic should complement your existing team. Ensure that the hiring experience is also on-brand, so applicants are immersed in your culture from the very beginning.
As you engage existing employees, they’ll become a great source of referrals for you. Referrals save your restaurant recruiting costs, and the strong relationships among coworkers will make for a happy and productive working environment for all.
- Give employees the right tools for the job
You may have the most competent, empathetic, and friendly employee—but if they don’t have the right tools they need to do their job well, frustrations are quick to arise, and performance will decline.
Make their jobs easier by reducing paper and automating processes where possible, so your employees can focus on delivering positive guest experiences rather than busywork.
Scrambling for an answer to a guest’s question can cause stress for your staff, and frustration for your guest. Empower your employees to deliver accurate information by making sure the answers they need, like nutrition and allergen information, are easy to access, even on the go.
Choose a Purchase-to-Pay and Inventory system that will allow your managers to work on the go via a mobile app, so they can get work done without being tethered to the back office. Getting your manager into the front of house improves their quality of life and the guest experience, and helps keep company values top-of-mind for the rest of your staff.
When you team feels like they have the tools and resources they need to do their jobs well, they will feel happier, more productive, and loyal to your brand.
Reduce unnecessary scheduling stress and paperwork
Scheduling can create a lot of unnecessary stress—and done incorrectly, can negatively impact your bottom line. Having too many people on the schedule makes for a slow and boring shift for them and a costly one for you. Having too few causes stress and scrambling, affecting the guest experience. A stressed team is more focused on turning tables than on delivering the best customer experience.
Instead, invest in a smart-scheduling solution that allows you to staff according to forecasted sales. For example, it takes more servers more time to run 50 $2 soft drinks to 50 different tables than it does for one server to sell a single $100 bottle of wine. The right smart-scheduling tool will be able to look at historical data, weather, past trends, holidays, and so on, and more accurately forecast based on projected sales. This allows you to set an appropriate schedule without stretching your staff too thin or over-scheduling in the beginning of the week.
The right workforce-management tool will also allow for collaborative scheduling, so employees can suggest times they’re not able to work, or request shift swaps or drops—giving them more control over their schedules. These tools can also allow employees to pick up extra "open" shifts, cutting back on headaches for managers, too. All changes can be approved via the app, which automatically updates the schedule so everyone has the most up-to-date version.
It may seem obvious, but getting your employees paid in the right amount, at the right time, every time is critical to keeping employees engaged and happy. Using a fully-integrated HR, scheduling, and payroll solution will improve your employee experience, while also ensuring compliance and eliminating risks for you.
- Encourage communication with a two-way messaging platform
A newsfeed for announcements and a channel for more urgent notifications and updates can ensure that nothing is missed and can keep everyone on the same page. Using a hospitality-specific app that’s fully integrated into a back-office workforce management solution will make sure that sensitive and proprietary information is only accessible to current employees.
Allow communication to be two-ways to further encourage engagement; employees should be able to like, comment, and share content. This added level of communication helps strengthen employee relationships and further reinforces a one-team-one-dream mindset. Your engaged employees will be more likely to support their colleagues offline, as well, further building that positive workplace culture.
In developing an engaged culture, it’s especially important to time to celebrate successes. Using this platform to share positive reinforcement and success stories can help everyone feel like a part of the wins. According to Gallup, employees who do not feel recognized at work are twice as likely to quit in the next year. Positive recognition in the workplace is a powerful motivator and will further boost your employee engagement—and it costs nothing.
Employees will leave for even a nominal pay bump but getting them to stay doesn’t have to cost anything. The culture in your restaurant can become the competitive advantage that—outside of financial motivation—keeps your workers happy and dedicated to your brand.
Engage your employees by providing the right tools for the job, a clear company vision and purpose, and a positive workplace environment. You’ll help retain your top talent and lower your hiring and recruiting costs, all while driving customer satisfaction, loyalty, and sales.
To learn more, download our complimentary guide to engaging and retaining employees.