Archive for May, 2015

Guest Blog: Training on the Go – A Direct Line to Food Service Profits

Monday, May 25th, 2015

Several years ago, the Peninsula Yacht Club was selected to be the club to implement the Hospitality Resources International Training on the Go (TOG) Program. Initially, the TOG program was met with some resistance from the front of house staff.  They felt that the program was another monotonous program whereby the dining room managers preach F&B mechanics to them for what seemed like hours.  Upon the staff’s recommendation, I changed the program’s delivery and made it involve the servers and bartenders more than the dining room managers.

In this new delivery, the servers studied a pre-determined module and then they were charged with presenting it to the rest of the staff.  This was the key to making the program work.  Now, servers would become teachers and would instruct their “class” in the pre-shift meetings.  There was no way to avoid having to teach a module as we required busboys, hostesses, servers and bartenders alike to instruct a class twice a month.

At first, the restaurant staff was enthralled by the alcoholic beverage information, especially the histories of liquors and wines.  This is the easiest part to teach because the 18-24 year olds seem to have an interest in learning about alcohol.  After they taught the beverage portion, we focused on foods and specifically our restaurant’s menu.  With the help of our chef, we were able to discuss the history of our menu choices, which wines would complement which entrees, and how to sell the daily features.  After the beverage and food modules were taught, we moved on to other important issues such as the steps of service, flow of the dining room, recovery techniques, etc. In the end, 94 modules were taught over a 16-month period.  Some of the more important modules were repeated.  After completing the modules in order, we have now begun to teach them in random order and allowing the staff to choose the module they wish to teach.

Once the TOG program was instituted and the bugs were worked out, several amazing things happened in our restaurant.  The first noticeable change was in the demeanor and confidence of the front of house staff.  Almost instantly, they became more comfortable discussing foods and beverages with members and guests and with making recommendations. Their newly gained knowledge of the preparations and histories of the food and beverages helped them to become more confident in their ability to answer members’ questions.  They looked forward to being asked about the history or preparation of certain items and the social interaction that was created when these questions were asked.

The second noticeable change was that our front of house staff turnover rate declined.  Our servers enjoyed coming to work and were not as apt to move on to another restaurant opportunity.  The restaurant staff felt more a part of the club and they enjoyed getting to know members more personally through their social interaction.  The staff no longer felt they were ‘going through the motions while waiting for the next new restaurant to open in the area.’

The third and most noticeable change was in the number of appetizers, desserts, and after-dinner drinks sold during the dinner shifts.  Just by gaining knowledge of these items, servers were able to discuss daily specials, suggestively sell at every table they were working.  The increase in the a la carte average check was immediate.  The servers’ confidence created an aura of professionalism and also caused a competitive nature in the restaurant.  Personal bets were being made to see who could up-sell the most wine or desserts.  Managers started offering a complimentary dessert to the server who sold the most after-dinner drinks.  The front of house staff loved the competition and it drove our sales to levels not seen in the past.  Of course, revenues followed.

To answer the question in the title of this article; “Is the TOG program a direct line to restaurant profits?” I offer the following evidence:

At the start of implementation, the club’s restaurant was experiencing a four-year decline in a la carte business.  This decline was, at the time, blamed on the poor economy before and after September 11th and a declining membership level.  In hindsight, these were only excuses for a more prominent problem.

Although the club’s membership level was declining, the average food and beverage revenue per member was holding steady at the 5-year average and the cover counts did not show a decline either.  Therefore, members were using the restaurant at a consistent rate in 1999, 2000, and 2001 up until 9/11.  What we noticed when looking at the revenue data was that the average check per member had declined drastically.  The data told us that members were continuing to dine in the restaurant at a steady rate, but they were spending less on each visit.  Our a la carte menu prices had not fluctuated during this period, so it led me to believe that we were doing something different in the dining room or, as I found out later, we were not doing some things that we had done in the past.

The TOG program was started in October of 2001.  Almost immediately, the average check increased and the number of appetizers and desserts increased as well.  Soon after, our alcoholic beverage sales increased, especially wine by the bottle, which shot up 200%.   In 2002, the program really took off.  By the spring of 2002, the up-selling competitions had begun and revenue increases were seen in appetizers, daily specials, desserts, after-dinner drinks, wine by the bottle and wine by the glass. For the 2002 year, the average F&B revenue per member increased 15% to $62.78 per month.  The trend continued in 2003 with revenues continuing to increase in 2004.  It is without question that implementing the Training on the Go program has had and continues to have a direct positive effect of restaurant revenues at the Peninsula Yacht Club.  If you think this program could help your club, visit the Hospitality Resources International website and download the TOG program.  It is a sure fire way to increase your restaurant’s revenues.

Article written by Chris Conner, formerly General Manager, Peninsula Yacht Club

A number of Training on the Go courses are available on the HRI store.  They can be previewed here.

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the hospitality industry and its challenges. From time to time, we will feature guest bloggers – those managers and industry experts who have something of interest to say to all of us. We also welcome feedback and comment upon the blog, hoping that it will become a useful sounding board for what’s on the minds of hardworking hospitality managers throughout the country and around the world.

Hospitality Resources International – Management Resources for Hospitality Operators!

 

Performance Leadership and the Internal Consultant

Monday, May 18th, 2015

The term leadership is most often thought of in conjunction with leading people, but given the underlying definition that leadership is influence, there are other types of leadership such as “thought leadership,” “management leadership,” “best practice leadership,” and ultimately, “performance leadership.”  While most club controllers supervise (or lead) but a handful of people, it is in the later types of leadership where they have the opportunity to influence a large number of club employees as well as the success of the club.

As we discussed in last week’s email – GM’s Job One – the club’s general manager, in addition to the all-important strategic requirements of the position, has his or her hands full with the many aspects of member relations.  This, then, necessitates a strong #2 who can promote, implement, and watch over the many management disciplines and best practices that are at the heart of a well-run club.

Often clubs have an assistant manager or clubhouse manager who serves as the second in command, but this position is primarily to ensure the smooth daily functioning of club operations with a heavy focus on food and beverage, as well as activities and events.  Seldom does this person have the time or focus to press forward with organizational issues and disciplines that cross departmental lines.

So who on the club’s staff is most likely to have the necessary knowledge and experience to formulate and implement club-wide performance initiatives?

In most cases the logical choice would be the club controller, particularly if you understand that the responsibilities of this position go well beyond accounting and financial reporting.  Of all club department heads, the controller should have the greatest understanding of the disciplines that underlie business success.  Also, a controller by career choice is a “numbers” person and has daily intimate contact with the measures of financial performance.  Last, but certainly not least, the controller in most cases has the greatest in-depth knowledge and familiarity with spreadsheet software – the instrumental tool of financial analysis.

For all these reason then, the controller is the ideal person to take the lead in enhancing the club’s performance.  But how to go about it and where to start?

As with any sort of leadership, the prime actor must have the knowledge; a plan of action and priorities; the skill set to effectively communicate with, instruct, and mentor followers; various teaching aids and tools; and most importantly the authority to direct implementation – either delegated from or with the explicit support of the GM or club board.

While every club will need to establish its own plan and priorities depending on its unique circumstances, my list of requirements would include:

  • Written Accounting AND Personnel Standards, Policies, and Procedures.
  • Written Internal Control Plan, recognizing that such a plan is not a separate, specialized system within the club.  Rather, it is an integral part of each department and the club as a whole; as such, internal controls are management controls.
  • Detailed budgeting guidance and timeline to improve the accuracy and ease of budget development.
  • A Linked Policies Database on the club’s server to provide easy access to key organizational and training material for the entire management team.  Such a database also makes it far easier to keep material up to date and to notify managers of changes to policy and procedures.
  • The discipline of Monthly Review of Financial Statements with individual department heads.
  • Tools to Beat Budget or some similar method of real-time tracking of revenues and expenses.
  • In depth Benchmarking of operations by all department heads.
  • Enhanced financial reporting package to include some form of Executive Metrics Report.
  • Training of department heads in all the requirements of their fiscal responsibilities using Management Disciplines on the Go, Accounting on the Go, 101 Tips to Improve Your Club Operations,  or other similar tools and resources (not only does this improve the club’s performance, but it enhances the skill set and career prospects of department heads).
  • Ongoing outreach by the controller to department heads for the purpose of problem discovery and performance enhancement (by doing this the controller, in effect, becomes an internal business coach or consultant assisting department heads in continual improvement of their department’s organizational efficiency and performance).

Some may object to this expansion of the controller’s duties, and no doubt such a program of performance leadership will require extra effort, but after initial implementation, the improvements in organizational efficiency club-wide will reduce some aspects of the accounting office’s workload.  Not every controller will possess the skills to be an internal consultant, but others may relish the challenge and opportunity to think and work “outside the box.”

In embracing the concept of the internal consultant understand that everything does not have to be done at once.  Carefully tailored pilot programs prioritized by the Pareto Principle, taking advantage of the enthusiasm of early adopters, and utilizing the discipline of incremental progress, will get you to the ultimate goal, as Jim Collins say in Good to Great, “turn by turn of the flywheel.”

Lastly, there is also the great personal satisfaction to be gained in the role of leadership, instructing, mentoring, and “consulting” with department heads to improve their operations and performance.  Various authors have long advocated that the basis for any act of leadership is service to others.  The service of performance leadership is its own reward – for the club, its member, the management team and employees, and not least of all – the club controller.

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the hospitality industry and its challenges. From time to time, we will feature guest bloggers – those managers and industry experts who have something of interest to say to all of us. We also welcome feedback and comment upon the blog, hoping that it will become a useful sounding board for what’s on the minds of hardworking hospitality managers throughout the country and around the world.

Hospitality Resources International – Management Resources for Hospitality Operators!

 

It’s Closing Time at the Club

Monday, May 11th, 2015

It’s been a long day for John the General Manager.  He arrived early this Friday morning and had a full day of meetings, including discussions with the architect regarding some planned renovations of the kitchen and locker rooms and a long session with the membership director over the upcoming fall membership campaign.  Having stopped by the Lakeside Room to check on the Taylor’s rehearsal dinner, he congratulated the happy couple, said a few words to Mr. and Mrs. Taylor, and is now heading out the door to join his wife and son for a dinner before John Jr. leaves for college the next morning.  The time is 7:15 p.m.

Marie, the Clubhouse Manager, assured that all catered events and the main dining room service is winding down, stops by the kitchen to let the Chef and Dining Room Manager know that she’s leaving.  She’s got to be back at nine in the morning to meet with the Lanes and the Catering Director to begin discussing plans for their Octoberfest party.  As she walks past the loading dock she notices a beat-up old car parked behind the dumpster.  She heads to her car thinking she must remind the Chef about enforcing the no parking policy at the rear entrance.  It’s now 9:30 p.m.

By 10:15 the banquet staff is well on its way to completing the breakdown of the two private dining rooms that were in use this night.  Ever mindful of controlling her payroll cost, the Banquet Captain sends three servers home while directing the remaining two in the reset of the Founders Room for a Saturday morning breakfast.  On his way through the kitchen one of the departing servers who missed his employee meal puts the butt of a tenderloin of beef from the Taylor party in his backpack.  Another departing server helps himself to two bottles of Heineken sitting on a table outside the beer cooler.

At 10:45 Chef Rick leaves after giving final instructions to Tim, his evening Sous Chef, who is in the kitchen office preparing production schedules for Sunday Brunch.  The new dishwasher who started this past week notes the Chef’s departure as he carries two bags of trash out to the dumpster.  Upon returning he enters the unlocked meat cooler and places a case of NY strip steaks in a trash bag, covering it with empty cans for the recycling bin.  He carries this back to the dishwasher area where he places it on the floor behind a stack of glass racks.

At 11:35 Marilyn, the Dining Room Manager, secures the various exterior doors in the dining room and lounge and passes through the kitchen announcing to Tim, “I’m outta here.”  Tim says he’s not far behind.  Before leaving Tim checks the storerooms and walk-ins to make sure they’re locked.  He discovers the unlocked meat cooler and locks it, shaking his head at the carelessness of the line cooks.  He notes the dishwasher is just finishing up at the pot sink and asks him how much more he’s got to do.  “Just some trash to take out,” is the answer.  Tim reminds him to turn the lights out and to pull the self-locking loading door tightly shut behind him as he leaves.  It’s now 12:05 and Tim is looking forward to stopping at O’Hanlon’s on his way home.

At 12:30 the night watchman makes his second round and discovers a back door to the pro shop unlatched and notes it in his security log.  This is the second time this month he’s found the same door unsecured.  In the meantime, at the other end of the clubhouse, the dishwasher loads his car by the dumpster with the case of steaks and two bottles of Glenfiddich he pilfered earlier from the unlocked liquor vault.

This fictional tale or some variation of it is an all-too-common scenario in private clubs.  By their very design clubhouses have a large number of exterior doors providing convenient member access to outside spaces and safe egress in case of an emergency.  While many of these doors have panic bars and are self-closing, they may be in remote locations and are easily left ajar.  Unless a club has a security system with electronic door contacts wired to a conveniently-monitored alarm panel, some responsible individual must check every door before leaving.

Many clubs have limited security monitoring devices and even fewer bear the expense of a night watchman or security service.  While cameras may be employed in key areas, the prevailing approach to protecting the assets of the club seems to be to trust all employees to do the right thing.  This is a major mistake that invites all kinds of trouble.  As a professor in hotel school told the class many years ago, “Respect everyone, but trust no one!”

Given that every club is different in age, amenities/facilities, setting/site layout, and investment in security systems, here are some basic things that every club should consider:

  • A rigidly-enforced policy that nothing is to be removed from the club.  This policy must include a warning that bags are subject to search at any time.  All managers must understand the legal ramifications of such a policy and how to go about enforcing it properly.
  • A rigidly-enforced policy of which doors employees must use to enter and exit the club.
  • A rigidly-enforced policy of employee parking, specifying that no employee vehicles may be parked at or near the employee entrances, dumpsters, or loading dock.
  • All policies spelled out in an employee handbook which contains an acknowledgement statement that employees have read and understand the policies, a signed copy of which is placed in each employee’s personnel file.
  • A review of all sensitive security areas of the club – food and beverage storerooms, pro shops, golf cart and bag storage areas, snack bars, activity centers and aquatics areas, golf course maintenance facility, location and use of all exterior doors, employee entrances, and the loading dock and dumpster area.
  • A review of key control policies and plans, as well as a determination of who has what keys.  Such policies must include procedures for reporting and handling lost keys and the security planning and responsibility for early morning and late night access needs.
  • Written opening and closing procedures with assigned responsibilities.  Use of signed checklists by opening and closing personnel, reviewed daily and double checked by management.  Keep in mind that W. Edwards Deming said, “Divided responsibility means that nobody is responsible.”  In other words when everyone is responsible, no one is!
  • Prepare a written security plan for all the club’s facilities.  Investigate costs and make cost/benefit decisions on cameras and access keypads for high-risk areas and employee entrances.  Such devices will allow review of access and aid in investigating losses.
  • A policy of fully prosecuting any employee caught pilfering or stealing club assets including retail and food and beverage inventories.
  • Periodic covert surveillance of employee entrances, particularly late at night.  Food and beverage managers, including kitchen managers/chefs should be given this duty with specific instructions to monitor closing activity on a periodic basis.  An alternative is to contract out this requirement to a security company, though having club managers do it is far more effective in that they have a better understanding of the operations and knowledge of individual employee duties.
  • Ongoing reminders and review of security policies and procedures at weekly managers’ staff meetings to continually remind all managers of security requirements.

The security of the club and its assets is a central responsibility of management and must be attended to in a formal and disciplined way.  Anything less invites trouble – and not just at closing time!

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the hospitality industry and its challenges. From time to time, we will feature guest bloggers – those managers and industry experts who have something of interest to say to all of us. We also welcome feedback and comment upon the blog, hoping that it will become a useful sounding board for what’s on the minds of hardworking hospitality managers throughout the country and around the world.

Hospitality Resources International – Management Resources for Hospitality Operators!

So What Does Your Most Junior Manager Know about the FLSA?

Monday, May 4th, 2015

Jimmy started working at The Prestige Country Club when he was sixteen and still in high school.  For several years he worked in the snack bar and then waited tables in the club’s dining room.  But his first love was golf and when offered a position with the golf operation’s outside staff, he jumped at the chance.

Outgoing, friendly, and always reliable, the golf professional staff could count on Jimmy to work whenever needed, frequently covering shifts for others who called off at the last minute.  He was one of those rare individuals who stayed busy any time the course was slow or when waiting for the last few groups to come in off the course on summer evenings.  Any time he had spare moments Jimmy was policing the practice tee, picking the range, or detailing golf cars. 

Over the years through his hard work, dedication, and outstanding attitude, he became one of management’s most appreciated employees and was selected the club’s employee of the month on a number of occasions.  When Bob, the club’s long-serving outside manager finally retired to free golf for life in central Florida, Jimmy was the natural choice to replace him.  It was an easy decision for Tom, the Director of Golf, as Jimmy was well-versed in the operation requiring little if any training, was a great ambassador for members and guests, and seemed to have a knack for recruiting the best prospects to work on the outside staff.  Everyone from the golf shop to the GM’s office were thrilled with the choice and the members loved the story of a dedicated young man working his way up through the ranks to a management position.

In the ensuing years the outside staff functioned so smoothly that no one gave the operation another thought.  So when the club was contacted by the Department of Labor, it took everyone – the club board, the General Manager, and the Director of Golf by complete surprise. 

As the Wage and Hour Division’s investigation unfolded, it turned out that Jimmy, in an effort to control his section overtime, had worked a “deal” with his employees that he would promise them paid time off in future pay periods in lieu of receiving overtime.  The arrangement worked well for Jimmy, allowing him to eliminate overtime while ensuring his section was well-staffed for any contingency.  He kept track of his promised time off informally in a notebook he kept and generally kept his staff happy with the arrangement.

But the “deal” went south after he was forced to fire Jerry for a variety of infractions including repeated tardiness, calling off on a three separate occasions, and the final straw – pilfering range balls.  Jerry felt aggrieved, particularly when Jimmy refused to “pay” him for the time off he was owed.  Jerry was determined to “get even” and contacted the Department of Labor.

During the investigation by the Wage and Hour Division, Jimmy said he was not aware that his actions violated the Fair Labor Standards Act and that he was just continuing a practice that Bob, his predecessor, had instituted to control overtime.

To make a long story short:  The investigation revealed that the club had been violating the FLSA for at least 12 years going back to Bob’s time as outside manager.  They also found similar violations in golf course maintenance.  The club was ordered to pay back wages to all identified employees, current and former, for the past three years; these payments amounted to over $127,000.  In addition, given the duration of the violations and the fact that they were found in multiple departments, the club was fined $10,000.

Collateral damage:  The club’s board was appalled at the lapse in management oversight of such a basic labor law requirement.  The Director of Golf’s annual bonus was withheld for two years and the General Manager was discharged for cause.

Lessons learned:  The “deal” wasn’t a deal for anyone involved.  All managers need to know the basic requirements of the Fair Labor Standards Act.  The employer is responsible for ensuring all managers are properly trained in the basics of the FLSA.

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the hospitality industry and its challenges. From time to time, we will feature guest bloggers – those managers and industry experts who have something of interest to say to all of us. We also welcome feedback and comment upon the blog, hoping that it will become a useful sounding board for what’s on the minds of hardworking hospitality managers throughout the country and around the world.

Hospitality Resources International – Management Resources for Hospitality Operators!