Archive for the ‘club operations’ Category

The Many Ways to “Kill” Employee Empowerment

Saturday, October 14th, 2017

We have spoken before about the importance of creating a culture that promotes Employee Empowerment at your club.  We quoted from John Tschohl, President of the Service Quality Institute, who said, “Without empowerment, an organization will never be a service leader.”  Mr. Tschohl went on to say that, “Empowerment is the most critical skill an employee can master and a company can drive in order to lure and keep customers.”

quote1-2Given the importance of empowering your employees, it’s helpful to understand the many ways to destroy such empowerment and that none of them are caused by employees.  If your employees do not feel empowered, look no further than your leadership and the way you interact with your people.  In searching for reasons empowerment isn’t working, focus on the following:

You are only paying lip service to empowerment.  Without your sincere commitment to your employees and their success, they will recognize your “empowerment” as a sham and will become more cynical and disaffected the more you try to encourage their “empowerment.”

You don’t really understand what empowerment is.  If you fail to realize that empowerment begins and ends with your leadership, if you think that empowerment is something your employees have to create, expecting your employees to act in empowered ways is a waste of time and energy.

You haven’t provided the “big picture” context of what your organization is trying to achieve.  Your employees need to understand how their contribution furthers the basic aims of the organization.  Defining and sharing your values and goals is a first step.

You’ve failed to give your employees the information and training they need to understand the context and scope of their empowerment.  When you ask them to take on additional responsibilities as empowered employees, they need to understand why and what the benefits are to them as well as to you and the club.  They will also need examples of what empowered behavior is.  Lastly, they will need to know that they will not be blamed or punished for making mistakes.

You’ve given them guidelines, but then micromanage them.  Maybe you’ve done a good job of defining limits, but then micromanage them.  When you do this they will quickly understand that they are not “empowered” and that you will continue to make all the decisions, no matter how trivial.

You second guess the decisions you’ve authorized your employees to make.  After giving your employees the guidelines to make empowered decisions, you second guess and criticize every decision they make.  Put yourself in their shoes; how long would you put up with this before throwing in the towel on “employee empowerment”?

You have failed to give feedback on how your empowered employees are doing.  Feedback, particularly early on, is critical so that employees understand by constant discussion and explanation what they are doing right and what can be improved on.  Once they achieve a critical mass of understanding, they will feel more and more confident of their actions, will need less guidance, and will be looking for more and more ways to contribute.

You have failed to value your employees.  Without the most basic sense that they are valued and recognized as partners in your efforts to provide quality and service to members, they will recognize that your program of “empowerment” is just a way to manipulate them.  People who think they are being manipulated are resentful and will be unresponsive to your continued exhortations to be “empowered.

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the club 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 club managers throughout the country and around the world.

Service Breakdown: A Failure of Leadership

Tuesday, October 3rd, 2017

After thirty-five plus years in the hospitality business in both hotels and private clubs, I can state categorically that poor service comes from poor leadership.  Show me an operation with poor, shoddy, inconsistent service, and I’ll show you an organization with a failure of leadership.  This observation flows from the understanding that leaders who recognize service problems in their organization will take corrective action.  They will establish a plan of action, set priorities, lead employees to execute the plan, and follow through to completion.

Why, then, is poor service so often the rule rather than the exception?  I have met many competent, hard-working, and professional general managers who voiced a clear and unequivocal service vision for their operations.  They understood the need for well-defined standards, thorough training of employees, and constant reinforcement of service ideals within their organizations.  Yet, they struggle to establish and maintain high standards of service.  While we all recognize the many demands on our time, the challenge of employee turnover, the training burden in a detail-intensive business, time constraints, and ever-present budget pressures, these are not the root problem.

In examining this challenge that never seems to go away, I believe I have discovered the most significant source of the problem – the lack of well developed and consistent leadership skills among subordinate managers, those who direct the day-to-day activities of the operation’s line employees.  While the general manager may clearly understand and articulate the requirements of service, unless that “gospel” is communicated faithfully, consistently, and continuously to line employees by their immediate supervisors, there is a breakdown in the service message.

Throughout my career I have inherited or hired front line supervisors whose background, experience, and education should have prepared them for the challenges they would face daily in our business.  While most had more than adequate technical skills to execute their responsibilities, they were often lacking in a critical aspect of leadership – how to direct and motivate employees to achieve high levels of quality and excellence.

While some front line supervisors demonstrated exceptional leadership skills, many did not.  Often my biggest problems were created by supervisors who did not treat their employees properly, who did not communicate expectations, and who did not seem to understand or follow the most basic requirements of leading or managing people.  These profound failings were crippling to the organization and required many hours of counseling, training, and, in some cases, terminations to remedy.

Over time I realized that any focus on training of line employees to smile and be friendly was a waste of time until I could be assured that supervisors developed basic leadership skills.  From that point on, I focused my efforts on training supervisors.  Regardless of background or education, I wanted them to learn to be effective leaders, to paint and preach a vision of excellence for their staff, establish goals, communicate expectations, provide support and training to their employees, and solve the inevitable problems that arise when people work in a service context.

The training called for a clear vision for hospitality operations and guiding principles that would shape our efforts.  I made it clear to supervisors that our employees were truly our most important resource, and they must be treated with dignity and respect.  Supervisors were told that their primary job was to provide direction, support, and training for their employees and that, based on their experience or education; I held them to a higher standard.  I also provided detailed guidance on how to develop line employees and correctly counsel and discipline when necessary.  Finally, I put a positive emphasis on communication and problem discovery.  In time these concepts were formalized into a leaders’ handbook which was issued to newly-hired supervisors.

How successful was I in achieving my ends?  I would frankly admit that the results were mixed.  While some supervisors responded positively, others seemed incapable or unwilling to grasp basic leadership principles.  These, typically, after much invested time and effort, were encouraged to take their talents elsewhere.  But on the whole, the effort yielded improved employee morale, lower turnover, better two-way communication, and a more upbeat team spirit among all staff.  We still struggled with budget and time constraints on training, but we were far better off than we would have been without the effort.

Consistency and high levels of service will always be a challenge in business.  Without competent and committed leaders at all levels, general managers will always be trying to “do it all.”  In time they will burn out or be forced to compromise their standards.  In either case the result is service breakdown.

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the club 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 club managers throughout the country and around the world.

Service-Based Leadership

Saturday, September 23rd, 2017

Service-Based Leadership is the foundation for Remarkable Service.

Given that leading ultimately involves guiding, influencing, and directing people, I posit the following working definition for “Leadership”:

Leadership is the sum of those individual traits, skills, and abilities that allow one person to commit and direct the efforts of others toward the accomplishment of a particular objective.

Central to this definition is the understanding that exercising leadership involves building and sustaining relationships between leader and followers. Without this bond or connection, there are no willing followers and, therefore, no true leader. Given that no leader operates in a vacuum, it also requires that the leader establish relationships with other relevant constituencies.

With Service-Based Leadership, the attitude and primary motivation of the leader is service to others – to members, to employees, to shareholders. This approach to leadership naturally creates relationships – the deep and abiding bonds that sustain the efforts of the organization. This outward focus of the leader sets up a dynamic where:

  • Employees are continually recognized.
  • There is an open flow of ideas, opinions, and information.
  • Initiative and risk are highly regarded.
  • Problem discovery and solution is a focus while placing blame is unimportant.
  • Every employee feels energized and part of the team and is valued for his or her contribution.
  • Prestige is derived from performance and contribution, not title or position.
  • Members are treated well because employees are treated well.
  • The energy and initiative of all employees is focused on the common effort.

With Service-Based Leadership, you will find that service to both internal and external customers is effortless. Less energy is expended in processing complaints, grievances, and conflicts. Work is more fun and everyone’s job is easier.

The Service-Based Leader understands that the key to serving the needs of those he or she serves lies in ensuring that strong relationships are established with individuals. How does one do this? Begin by:

  • Treating everyone you meet with courtesy, respect, and good cheer.
  • Focusing on each person you deal with as if he or she were the most important person in the world.
  • Taking the time to get to know people; sharing your time and attention with them.
  • Learning about other people’s jobs and the challenges and difficulties they face.
  • Keeping promises and following through on commitments.
  • Being principled, showing fairness, and demonstrating integrity.
  • Recognizing the ultimate value of people in all you do.

Relationships depend upon how you view yourself in relation to others. If you see yourself as separate and apart from your constituencies, if you view others as the means to your end, if your vision and goals lack a broader purpose than your own needs and ambitions, establishing meaningful relationships will be impossible. On the other hand, when you see yourself as part of a team with a shared mission, then a sense of service will be an intrinsic part of your service team relationships.

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the club 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 club managers throughout the country and around the world.

A Culture of Service

Sunday, September 10th, 2017

We frequently talk about the importance of developing an organizational culture of service.  What exactly do we mean by an organizational culture?

The dictionary defines “culture” as the sum total of ways of living built up by a group of human beings and transmitted from one generation to another.  With a slight modification of this definition we come up with the following working definition of organizational culture.  The sum total ways of working and interacting built up by a group of people within an organization and transmitted from one generation of employees to another.

The major benefit of establishing an organizational culture is that once adopted by the majority of people in an organization the culture takes on a life of its own and permeates the workplace.  As normal turnover takes place, new hires quickly learn that to be accepted in their new surroundings, they must embrace the culture and make it their own.  In the absence of a culture developed and disseminated by the organization’s leadership, a culture will arise on its own, usually fostered by a vocal few and often cynical and at odds with the purpose of the organization.

So how do you create a culture in your organization?  First, you have to define clearly and succinctly the aims of your organization and what it aspires to be.  These are most often found in Mission and Vision Statements.  Beyond these basic statements of intent, one must clearly spell out standards of behavior and performance.  These can be in the form of Guiding Principles, Operating Standards, Leadership Principles, Service Ethic, Principles of Employee Relations, Organizational Values, Service Pocket Cards, a Code of Professional Ethics, or any other formal statements describing the “What, How’s, and Why’s” of how organizational business should be conducted.

Yet publishing such principles and statements, no matter how inspirational and well-written, will only foster employee cynicism if the values are not enthusiastically embraced by the organization’s leadership.  On the other hand, when leadership demonstrates their commitment to the organization’s values by their daily example, employees will do likewise.

With well-defined values and the enthusiastic example of leaders, the ground has been prepared for the fruits of organizational culture, but just as in growing a garden, preparing the soil is only the first step.  The real work for a successful harvest is the daily tending – watering, fertilizing, pruning, weeding, and pest control.  In the case of an organizational culture, it is daily reinforcement at every opportunity with all employees that continues to focus individual attention on the values that underlie everyone’s efforts.  In some cases, it’s publicly recognizing an employee for embracing and utilizing the values in their work relationships or service rendered to members.  In other cases, it’s privately correcting an employee who has ignored or transgressed the culture.  In extreme cases, it’s terminating the employee who refuses to accept the group norm.  The key is to continually remind employees of the organization’s values and elevate them from words on a page to an animating spirit that permeates every aspect of the organization and its work.

From the process of continually accentuating and reminding one achieves a breakthrough similar to that described in Jim Collins’ book, Good to Great.

Sustainable transformations follow a predictable pattern of buildup and breakthrough.  Like pushing on a giant, heavy flywheel, it takes a lot of effort to get the thing moving at all, but with persistent pushing in a consistent direction over a long period of time, the flywheel builds momentum, eventually hitting a point of breakthrough.”

This breakthrough is reached when the organization achieves a critical mass of employee buy-in.  Though the process of establishing an organizational culture requires patience and persistence as well as leadership and example, when breakthrough is achieved, the culture takes over and is self-sustaining – with the employees holding the bar high and policing their own ranks.

In such an organization, employees understand what must be done and how.  Motivation and morale are sky-high as employees are empowered by their participation and contribution.  The leader, relieved of the burden of constantly following behind employees to ensure they are doing the right things, can focus on strategic issues and the future of the organization.

The importance of a well-defined and promoted organizational culture cannot be overemphasized or underestimated in its impact on quality, performance, and member service.  The only thing that can screw it up is for the leader to fail to show an ongoing interest or set an uncompromising example of the organizational culture and its values.

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the club 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 club managers throughout the country and around the world.

Employee Empowerment

Sunday, September 3rd, 2017

John Tschohl, Founder and President of the Service Quality Institute, says, “Without empowerment, an organization will never be a service leader. Empowerment is the most critical skill an employee can master and a company can drive in order to lure and keep customers.” That statement from one of the country’s leading thinkers on quality is strong and unequivocal. But just how does a company or organization “drive” employee empowerment.

The answer is simple and just as unequivocal – Service-Based Leadership.

Without effective Service-Based Leadership, not just at the top of the organization, but at all the intervening ranks down to, and most importantly, front line supervisors, the necessary relationships will never be formed with line employees. Here are some quotes that make the point.

People who are unable to build solid, lasting relationships will soon discover that they are unable to sustain long, effective leadership.”
John C. Maxwell
Developing the Leader Within You

“With Service-Based Leadership, the attitude and primary motivation of the leader is service to others – to members, to employees, to shareholders. This approach to leadership naturally creates relationships – the deep and abiding bonds that sustain the efforts of the company.”

Leadership on the Line

“This leadership style differs from others in its focus on serving the needs of employees to provide them with the proper tools, training, resources, motivation, and empowerment to serve the club’s members.”
The Quest for Remarkable Service

“How can employees provide quality service if they are not properly served by the leadership and example of their managers?”
The Quest for Remarkable Service

“As a group of people committed to common goals, you can only achieve your team’s greatest potential by taking advantage of the talent, initiative, and ingenuity of each and every one of your employees. To the extent that any individual is not valued, trained, and motivated, your enterprise suffers.”
Leadership on the Line

For employees to feel empowered, you have to create a culture that nourishes and sustains it. By conscientiously and sincerely working to become the best Service-Based Leader you can be . . . you will create an environment where employees will recognize their empowerment and enthusiastically act on it in all they do.”
Employee Empowerment

“[None of the ways to kill empowerment] are caused by employees. If your employees do not feel empowered, look no further than your leadership and the way you interact with your people.”
Employee Empowerment

Summary: Since employee empowerment ultimately depends only on “the recognition by employees that they are empowered,” empowerment is a direct result of an organization’s systematic development and institutionalization of Service-Based Leadership.

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the club 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 club managers throughout the country and around the world.

The Imperative of Manager Training

Sunday, August 27th, 2017

Last week we talked a little about Employee Training and posed some questions about clubs’ training programs. This week we talk about an even more important topic – Manager Training.

In many clubs the assumption is that if you hire good people as golf professionals, food and beverage managers, controllers, activity directors, golf course superintendents, membership directors, etc., they don’t need to be trained because they know what they’re doing. While this may be true of the job skills for their particular position, there is far more a manager must know and ignoring this fact can be dangerous to your operation.

Managers and supervisors must understand and promote the club’s organizational values and culture. They must also understand their responsibilities in a variety of areas with legal and liability implications such as FLSA, EEO, ADA, USERRA, FMLA, OSHA, sexual harassment, workers and unemployment compensation, youth employment, and public health issues such as food sanitation and waterborne diseases.

They must also understand the club’s organizational systems, such as human resources and accounting, they need guidance on hiring, onboarding, and training; and while we expect all our subordinate managers to be honest, my long career experience proves that to be a naive assumption.  To be sure this doesn’t become an issue you should provide ongoing ethics training.

But more than anything I’ve found that managers, particularly junior or first-time supervisors, need leadership training. I would go even further and state that unless every manager and supervisor is trained in the requirements and habits of Service-Based Leadership, your club will never achieve service excellence and will continually be embroiled in time-consuming human resource issues.

As John Tschohl, Founder and President of the Service Quality Institute, says, “Without [employee] empowerment, an organization will never be a service leader.” And without a foundation of Service-Based Leadership, your employees will never be empowered.

Lastly, a club’s managers and supervisors act as agents of the club, granted the authority by the Board and General Manager to make decisions and act on behalf of the membership. As such, poorly-trained managers cannot be allowed to expose the club to liability as a result of ill-considered actions.

The Bottom Line: Training managers and supervisors to a common standard of leadership and understanding of their duties is an imperative for any club that aspires to excellence!

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the club 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 club managers throughout the country and around the world.

Staff Training

Monday, August 21st, 2017

High quality and consistent service is something that our members not only expect, but demand.  Yet in a detail-intensive business such as ours where so much has to be done just right in every service encounter, training employees is a gargantuan task, made even more challenging by a transient workforce and high turnover in critical service positions.  Often our employees who have learned the most from our service culture are lost to the lure of the newest restaurant in town or the one with the highest tips.

Given the importance of training and the reality of tight budgets, it seems the only solution to the club training challenge is to organize and format training materials to be easily-given with a minimum of time investment for both instructor (manager) and student (employee).  One solution is to use “on-the-go” training materials where information and skills are provided in frequent, small and easily-digested doses.

But there is more to training employees than just the skills of their particular position.  Employees must also have a thorough grasp of the club’s culture and service values.  Otherwise, each employee is simply doing what he or she thinks is best.  While well-intentioned, this clearly doesn’t foster a consistent quality of service.

There are also a host of policies and procedures that each employee must know – again, this is an area where consistency is imperative.

With so much to teach each new employee, do you have a training strategy beyond osmosis?  Have you ever fleshed out a curriculum for each service position?  Is your training material written down for consistency and formatted for brevity and clarity?  Do you test your employees on training materials?  Do you offer follow-up or refresher training?  Do you track the training that each employee gets to make sure everyone is trained to the same standard?  Do you encourage feedback from employees regarding the adequacy of training?  Do you periodically review and revise training materials?

All of these are legitimate questions about your club’s training effort.  But who has the time you may be thinking?  Some managers will excuse the lack of formal training by saying it just isn’t in the budget.  Yet I would say that training is more about organization, discipline, and the “will to make it happen” than it is about cost.

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the club 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 club managers throughout the country and around the world.

The Challenges of Standalone Club Operations

Monday, August 14th, 2017

My wife is a high school English teacher and I get to hear her periodic horror stories from the world of public education. Several years ago, growing interested in her comments on the state of our schools, I picked up a book called Crash Course by Chris Whittle. Whittle made his money in magazine publishing and with Channel One, the news program provided to public schools. He then turned his attention to public education and founded Edison Schools, a for-profit education management organization that would hopefully bring a solution to some of our worst-performing schools. While Edison Schools has not been as successful as originally envisioned, I found his review of public education insightful and full of interesting ideas.

In his book he discussed the challenges facing small town and rural school districts with limited resources and few economies of scale. As I read his critique, I was amazed that so many of the points he made about these school districts applied just as much to standalone club operations. For me it was a moment of epiphany. Throughout much of my career I worked in independent hotels or clubs with no more resources than our lean management staff could muster among ourselves. In job after job, we had to create personnel and accounting policies and procedures, job descriptions, training manuals, employee handbooks, and other materials to support our operations.

What made it so difficult was that we, the management staff, were up to our necks in operations and daily crises. Some of the operations were 24/7 and finding the time to develop organizational material was a nearly impossible challenge. Yet, if we ever wanted to stop reacting to problems, we needed to organize the operation for efficiency and consistency, while spending more time planning and thinking strategically.

Over the past thirty years, the hotel industry has successfully consolidated into chain operations and management companies, but the greater part of the club industry has not, and probably never will, due to the individual ownership of clubs by members and the reluctance of many to hire management companies. This leaves the industry full of standalone operations with limited resources and benefits of scale.

In response to these challenges Club Resources International, a portal website serving club industry managers at all levels of the operations, has recently been launched. On this site you’ll find a variety of resources from White Papers; Best Practices; Job Descriptions; Standards, Policies, and Procedures; Training Manuals and materials; programs to improve the understanding and efficiency of operations such as Tools to Beat Budget and Operations Benchmarking; as well as links to other industry resources.

The vision of this website is to grow into a one-stop resource for the materials that managers need, but don’t have the time to develop. Since so many of club operations are similar, there’s no sense in reinventing the wheel. Simply register for free on the site, download the desired material, and customize it to your own needs.

Lastly, we actively encourage other voices and points of view. Just as there are clubs with varying combinations of amenities, there are also  a number of ways to organize and operate a club. All quality submissions will be posted with appropriate attribution to individual author and organization. Harnessing the collective power and intellect of club managers worldwide makes more sense than each of us trying to go it alone!

Thanks and have a great day!

Ed Rehkopf

These blogs comment on and discuss the club 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 club managers throughout the country and around the world.

Inspiring Your Work Teams

Friday, September 30th, 2016

You may direct and manage your operation, but it’s the line employees who deliver the quality and service you envision for your members and their guests.  Without an effort to inspire extraordinary performance from this critical staff, they will respond like many other hourly employees in other industries – just going through the motions without dedication or passion, doing what they have to do to get by and collect their paychecks.

This may be enough for a lot of jobs, but it doesn’t cut it in an industry whose very name implies warm, friendly, hospitable service. 

Recognizing as everyone should that such service flows from dedicated and passionate leaders, what are some practical things you should be doing to engage and inspire your work teams.

By consistently doing the above in all your dealings with staff, you build trust, establish meaningful relationships, and inspire your people with your daily engagement and example.  The impact on the quality and service your team provides will be astounding.  This then is the heart of Service-Based Leadership and when done consistently throughout the club, it will take your operation to a whole new level.

On the other hand, here are the Enemies of Effective Leadership.  Read the list and consider where your club stands.

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!

A Roadmap to Successful Club Benchmarking

Tuesday, June 28th, 2016

In late June of 2012 I participated in a panel discussion on benchmarking at the Hospitality Finance and Technology conference in Baltimore.  My fellow panelist was Russ Conde of Club Benchmarking.  Some weeks after the conference I received a sheet summarizing attendees’ reviews of the session.  While mostly positive, one of the attendees said that the discussion covered a lot of benchmarking concepts, but was short on the specifics of how to benchmark.

As I have written in Twelve Reasons I Benchmark, there are a number of reasons to benchmark your club’s operations.  One important reason is to compare your club’s performance to that of the wider industry – and Mr. Conde’s Club Benchmarking service does just that in a simple, automated way via the Internet while providing standardized benchmarks industry-wide.  The CB analysis tools and reports support strategic versus tactical thinking in the boardroom.  A study of data from more than 1,200 clubs currently in the CB system has revealed a number of Key Performance Indicators with direct impact to the bottom line and confirmed the existence of a common private club business model now known as the “Available Cash Model.”  I cannot commend Mr. Conde and his partner Ray Cronin enough for this invaluable service to the industry.

But just as there is value in benchmarking your operation externally, there are valid reasons to benchmark your performance internally – that is within each department and the club as a whole.  Having provided this context, let me now provide some of the key specifics on how to benchmark.

First, for those wishing to compare their performance to other clubs and graphically visualize how their operation relates to the industry’s common business model, it couldn’t be any easier – simply visit the Club Benchmarking website and sign up for their service.

Second, for those who want to set up an internal program of benchmarking, here’s a discussion of some of the challenges and pitfalls, as well as information on where to get the necessary benchmarking instructions and spreadsheets to do it:

  • Let me start by saying that every day there are literally hundreds of data points generated in club operations.  The real benefit of benchmarking, though, is in tracking data over time.  The number of meals served in the club dining room on a particular Friday night doesn’t signify very much; it is simply an occurrence.  But if that number is part of a declining trend in Friday night dining, it is certainly a cause for concern.  Without the effort to track trends and compare them to historical performance, there is no way to manage for either quality or performance.
  • It is essential that the club’s General Manager buys into the value of benchmarking and fully supports the effort.  Without his or her backing, it will be far more challenging to implement club-wide benchmarking.  That doesn’t mean that individual department heads cannot benchmark within their departments and be successful, but it does limit the overall value of benchmarking to the club.
  • It is helpful to have a point person for the project – and I suggest the club controller.  This does not mean that the burden of benchmarking falls on the controller’s shoulders – as each department’s benchmarks must be the responsibility of the department head.  But it is helpful to have a person knowledgeable about accounting and the use of MS-Excel to help guide and assist less knowledgeable department heads through the process.

Having said this I also want to stress that the controller’s office is the logical place for the preparations of several key reports (some sort of Weekly Revenue Report, see HRI Form 203 for an example, and a Pay Period Summary Report, HRI Form 229) that will facilitate data availability club-wide, as well as the consolidation of key benchmarks from all departments into the Executive Metrics Report which I have advocated as a useful enhancement to the monthly financial reporting package.

But even in the absence of such reports from the accounting office, a conscientious department head, recognizing that she is the person fully responsible for her department’s performance, can with a little effort get the necessary data to benchmark.  For example, revenue information can usually be accessed from point of sale reports and payroll data is available from the accounting office or payroll service – both merely take a little initiative to get the desired information.

  • Depending on the club’s pace of operations and individual department heads’ workloads, it may make more sense to start small with one or two departments whose managers are “numbers” people and who relish the idea of a deeper empirical understanding of their business operations.  The enthusiasm and resultant success from these early adopters or “pathfinders” will serve as an invaluable inspiration and guide for others.  An alternative would be to implement one significant form of benchmarking club-wide – say benchmarking payroll costs across all departments.  In time, the value of this will lead to a desire for more robust benchmarking of other areas of club operations.
  • While every club can set their priorities for data to benchmark, here are some suggested priorities and the reasoning behind them:

Profit and Loss Statement (as part of the Executive Metrics Report) – low hanging fruit, easy to access data from P&Ls, requires only monthly data entry.

Payroll Cost – largest cost in operations, potentially yielding greatest opportunity for improvement and savings; makes future budgeting far easier; most effective when employees are paid on a bi-weekly basis (read Why Our Workweek and Pay Cycle? to understand why).

Departmental Revenues – by day of week, week by week, monthly, and annually; easy to access data, historical record can improve staff scheduling, makes future budgeting far easier.

Food and Beverage – probably the most effort and time-intensive if done thoroughly (tracking sales of beer, wine, alcohol, appetizers, desserts, specialty drinks, etc.), but provides critical feedback on any efforts to improve the average check; data can also help with managing inventory levels of alcoholic beverages.

Inventory and Accounts Receivable – low hanging fruit, easy to access data in accounting office, helps monitor and correct inventory volatility, requires only monthly data entry.

Retail – can dramatically improve performance when coupled with other retail disciplines.

Utilities – low hanging fruit, data comes from monthly utility bills, once-monthly data entry for electricity, water & sewer, and gas; helpful in spotting and investigating usage and billing anomalies.

Individual Departments – prepared by department heads, makes them more knowledgeable about operations (enhancing their authority and influence), analysis of benchmarks leads to improved performance.

  • All the resources to begin internal benchmarking at your club can be found on the Club Resources International website.  Simply purchase the 153-page Club Benchmarking Resources for $99 at the Marketplace store.  It contains the background information, the basics of benchmarking, departmental benchmarking instructions, and samples of benchmarking spreadsheets.  Each departmental instruction gives a list of benchmarks to track and sources of data, as well as specific instructions on how to use the spreadsheets and a sample spreadsheet for both year-to-date and year-to-year tracking.

A number of benchmarking spreadsheets are available on the Club Resources International website and can be downloaded at no charge.  After downloading and reviewing the benchmarking material, managers can customize the spreadsheets* for their operations, and begin collecting and recording the necessary data.  If key data has never been tracked before, patterns will emerge pretty quickly as benchmarking progresses, though the longer the data is tracked, the more valuable the benchmarks will be as operating standards.

  • My experience with benchmarking over the years is that it usually takes several months of close focus and review to successfully set up; thereafter ongoing benchmarking becomes part of the club’s routine.
  • Some department heads may need training and handholding during implementation, particularly if they are not familiar with computers or spreadsheet software, but once up to speed, they fully appreciate the value of monitoring the underlying details of their operations.
  • An important discipline that fully exploits the benefits of benchmarking is to make a formal review of departmental benchmarks part of the ongoing monthly review of financial statements with each department head.  When combined with the Tools to Beat Budget program and an examination of progress toward the goals of the department head’s annual work plan, benchmarking becomes a particularly effective means of driving progress and performance club-wide.
  • All departmental benchmarks are then summarized on a monthly basis using the spreadsheets and a copy forwarded to the controller for the next and final step in the benchmarking program.
  • The club controller completes the Executive Metrics Report using selected benchmarks from the departmental spreadsheets and submits it to all stakeholders as part of the club’s financial reporting package.  One controller who presented the EMR to the club’s finance committee reported that a particularly influential member said he was “thrilled” to see such underlying performance data and looked forward to reviewing it on an ongoing basis.

Benchmarking is an essential business discipline that yields significant benefits to club operators.  As H. James Harrington author, engineer, entrepreneur, and consultant in performance improvement, said “If you can’t measure something, you can’t understand it.  If you can’t understand it, you can’t control it.  If you can’t control it, you can’t improve it.”

*Individual clubs will undoubtedly want to customize the Excel spreadsheets for their range of departments and scope of operations.  While spreadsheets are “protected” to prevent inadvertent write-over of cell formulas, the protection is not password-protected, allowing individual clubs to modify the spreadsheets as necessary.

If you have any questions or want more information about any aspect of benchmarking, contact us at info@clubresourcesinternational.com.

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.

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