The ABCs of Succeeding in a Downturn Economy

A is for Action. Address changes in the marketplace with appropriate activity and adjustments in your marketplace. If you’re standing still you’re walking backwards.

By Jim Sullivan Copyright 2008

 

  • A is for Action. Address changes in the marketplace with appropriate activity and adjustments in your marketplace. If you’re standing still you’re walking backwards.
  • B is for Basics. Get brilliant at them now while your competitors are distracted.
  • C is for Cash. It’s hard to make and easy to spend so make what you can and hang on to it in these challenging times.
  • D is for Developing your people. None of us is smart as all of us.
  • E is for Execution. What we know means little. What we do with what we know means everything. Teach your team not only what to know but why it’s important. Measure how well they use the training, not how they did on a test.
  • F is for Focus. To paraphrase an ad I recently saw: “There was a time when focusing on the fundamentals really mattered. That time is called now.”
  • G is for Gross Margin. Measuring success via top line sales alone is misguided. You don’t take “top line sales” to the bank.
  • H is for Habitual Consistency. Success in our business is predicated on doing a thousand little things right every day. Things so small that the guest may not even notice them. Until we don’t do them.
  • I is for Innovation. Know this about innovation: it’s easier to get new ideas into our head than it is to get old and irrelevant ones out. New ideas must be balanced with a purge of something that no longer works.
  • J is for Junior Managers. At least sixty-percent of all shifts are run by assistant managers. Make certain they understand how to lead, develop and inspire your hourly teams as well as the GM does.
  • K is for Key Result Areas. Measure what matters (marketing, labor, service, sales, retention, quality, culture and financial results) and stop focusing on the extraneous things.
  • L is for Leadership. In good times or bad the formula goes thusly: Leadership, first. Team second. Customer third.
  • M is for Monitoring performance. Assess unit performance, issues and corrections every 30 days at the same time you assess the physical inventory in each store.
  • N is for NRN.com. If you’re not using this comprehensive online resource every day to research the industry’s evolution, best practices, and solutions you’re not operating at full capacity.
  • O is for Overhead.v The lower you keep it, coupled with higher sales, the better your gross margin. (See “G”).
  • P is for Please. Always say please when asking for payment. Make eye contact. Don’t thank the cash register.
  • Q is for Quality. Every shift, a pristine application of standards, processes and values is necessary to deliver on the brand promise. This extends to who and how you hire and train.
  • R is for Reality. Face it. Stop the “woe-is-me” mentality and get focused on what you need to do today to make the future a success.
  • S is for Silos. Destroy anything that prevents departments and teams from interacting, celebrating and collaborating together on the greater good. Blow up silos the minute they appear and 86 the people who insist on building new ones.
  • T is for Talent Scaffold. If you’re good at finding the right investors, but stink at finding leaders, your concept is doomed to shrink as small as the period that ends this sentence. Successful companies have infrastructures that continually find, groom and replicate talented teams across both regions and franchisees.
  • U is for Upturn. “Manage in good times as if you were operating in bad times,” my Dad used to say, “because eventually bad times will come.” Good advice, but remember that the opposite is not true. Take time now to do the things that will make you stronger when the upturn comes: improve yields, training, service, throughput, labor costs, and leadership.
  • V is for Video games. Running a restaurant is like playing a video game. Fun to do but boring to watch.
  • W is for Worrying about the things you can control, not the things you can’t. You can’t control the economy, Wall Street, or oil, gas, and commodity prices. You can control who you hire, what you stand for and how you treat the guest.
  • X and Y are for the chromosomes that define gender. Studies indicate that over 55% of our front-of-the-house hourly teams are female. Here’s hoping that the industry will seek similar parity in our executive leadership ranks as well.
  • Z is for Zodiac. Defined as “a set of things or a sequence of events that repeats itself cyclically,” the astrological chart is an appropriate metaphor for these challenging times. In a “downward cycle”, if you MUST obsess, choose the word cycle.