Archive for June, 2018

The Hierarchy of Service

Monday, June 25th, 2018

While Service-Based Leadership stresses that the leader must serve the needs of his or her constituencies, not all constituent needs have equal weight or importance.

Owners or shareholders are usually the smallest constituent group in numbers, but their needs are paramount.  Why?  Because it is their capital that has been invested in the enterprise and their need for return on investment that permits the continuation of the business.  If it is not making a profit, if it cannot gain credit based on a potential for future profit, if it cannot meet its cash needs for payroll or to pay vendors, it will quickly go out of business and the needs of all other constituencies will become irrelevant.

Obviously, a return on investment is important.  Consider why an owner would want to earn 2% in a business when he could invest his money in a less risky investment and earn a better return.  While there may be other reasons for continuing to own a business such as prestige; a sense of obligation to family, community, or employees; or the expectation of improved future performance over the long haul owners will not be willing to risk their capital on a poor-performing venture.

Next in order of importance are the needs of customers.  Without sufficient customers  patronizing the business, it will not be profitable or viable.  If not viable, it will not last long-and all constituencies lose.

Ultimately, customers are attracted by price and the quality of products and services.  Taken together, quality and price create a sense of value the value perceived by customers.  If enough customers perceive value, they will frequent the enterprise to spend their money and will make it successful.  If not, the business will ultimately fail.

This statement brings us to our third constituency the employees.  They are the ones who execute the owners’ vision for quality of product and service.  They are the ones whose daily interaction with customers creates the value customers seek.  Properly led, valued, and supported, employees will enthusiastically commit to serving the business’ customers thereby fostering levels of business that enable it to thrive.

Organizational Models

org-chrt-traditional-41The basis for the traditional hierarchical organizational model is the military concept of “chain of command.”  In this model, management is represented as the sequence of authority in executing the will of the owners and certainly management plays that essential role.  But in addition to not representing the importance of customers, it also places the employees at the bottom of the chain thereby visually relegating them to the position of least consequence.

pyramid3-2The Service-Based Organizational model depicts the importance of satisfying customers, as well as the important role of employees.  The organization’s leaders are placed at the bottom, clearly emphasizing their role in serving the needs of all constituencies.

Excerpted from Leadership on the Line – The Workbook.

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 managers throughout the country and around the world.

Employee Empowerment

Thursday, June 14th, 2018

The aim of Service-Based Leadership is to empower employees at all levels to think and act in alignment with your club’s values as they serve the needs of all constituencies — boards, members, and other employees.  Ultimately, employee empowerment is the end result of Service-Based Leadership.

Instead of the traditional view that employees are easily replaceable elements in an organization, people who must be trained to do narrow, well-defined tasks and who must be closely watched and supervised at all times, the concept of empowerment says that today’s more educated and sometimes more sophisticated employees need and want to contribute more to their employer and workplace.  Yet many clubs marginalize their employees by refusing to listen to them and by failing to let them contribute to the enterprise in any meaningful way.

Further, highly successful clubs who engage their employees in developing work processes and continual process improvement have discovered that these empowered employees make indispensable partners in delivering service.  Not only do they have a greater stake in the enterprise and are more fully committed to and responsible for their work, they actually equate their purpose and success with that of their club.

What is Employee Empowerment?

So what are empowered employees and how can they help your club meet its Mission and Vision?  In the simplest terms empowered employees are viewed as full-fledged partners in your quest for high levels of quality and service.  They are encouraged to think, act, and make decisions on their own based on guidelines defined by the club.

Leaders must understand that empowerment is not something bestowed on employees like some magical gift from management.  The leaders’ role is to establish both the environment and atmosphere where employees feel their empowerment and are emboldened to make decisions, knowing they have the support and backing of their leaders.

The major role that leaders make in empowering their employees is to create a culture where employees are valued and recognized as vital resources of the enterprise.  They must also understand that to be successful with employee empowerment, employees must fully sense the club’s commitment to such empowerment; simply saying that employees are empowered, does not make it so.  Leaders at all levels must do more than talk the talk.

While employee empowerment may be seen as a desirable practice by management, it ultimately comes about only with the recognition by employees that they are empowered.  This means that the focus of leaders must not be on what employees are doing to achieve empowerment, but on what they themselves are doing to promote and enable it.

Excerpted from Leadership on the Line – The Workbook.

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 managers throughout the country and around the world.