May 16, 2019

3 Phases to Successful Digital Transformation in Your Restaurant

70% of change programs fail due to employee resistance and lack of management support. It is statistics like these that are enough to keep even the most exhausted restauranteurs up at night.

According to McKinsey’s well-cited article, when people are truly invested in change the chances that it will ‘stick’ increase by 30%. But how can you ensure that your people are on board?

As mentioned in our previous blog, wielding your employees with the relevant tech solutions can massively propel your guest experience whilst contributing towards a more efficient and profitable restaurant operation.

But before you start the digital transformation process you must successfully navigate through the white noise of hospitality and restaurant tech; ensuring that you choose a solution that has maximum alignment with your business strategy, including short-term and long-term financial goals.

Chipotle did just that in their recent turnaround plan, which included a greater focus on increasing digital sales through their click and collect ordering platform. The result? A ‘Digital Pick Up Shelf’ initiative that provides customers with a convenient and speedy ordering process, enables managers and employees to benefit from the reduced operational bottlenecks whilst contributing towards Chipotle’s strategy and reflected in their 100.7% increase in digital sales in Q1 of this year.

On face value, speculating how different tech solutions are likely to contribute to your organisation’s strategy is a relatively straightforward process. What requires attention to detail is coming to understand how digital transformation is likely to impact your people and business as a whole.

Digital solutions tend to both directly and indirectly impact aspects of your business and it is therefore important to foresee these implications before committing to a new technology. As many ‘solutions’ are likely to be detrimental to other aspects of your business’s operation.

But assuming you have successfully undergone your due diligence by weighing up the options and ensuring alignment with your business strategy, you still have the transformation process to tackle. The way we at Hospitality Mavericks see it, this can be organised into three distinct phases:

1. Build the Right Mindset

McKinsey reported that 70% of digital transformation projects do not achieve their stated results, with the most common reasons being lack of employee engagement, inadequate management support, poor or nonexistent cross-functional collaboration and a lack of accountability.

With each of these pitfalls relating to human behaviour, it is apparent that the single best way to safeguard your digital transformation process is to make sure that you are actively are getting your people behind the change and shaping their mindset. This should be characterised in a business culture that:

  • Engages your leaders & employees in the digital transformation process;
  • Is supportive of managers and provides them with the necessary training & resources during the key phases of digital transformation;
  • Setting up communication platforms & giving teams the opportunity to collaborate & share knowledge effectively throughout the organisation. For example, we’ve seen firsthand benefits from the solutions Ziik & Yapster;
  • Has clear parameters of employee responsibilities & therefore accountability for every area of the digital transformation — from the CEO to the frontline.

Leaders should focus on creating a unified understanding of why the digital transformation process is crucial to their business’s goals and strategies. This may begin with an argument as to how the digital solution is going to propel the guest experience, drawing on the ‘win-win intersection’ that Nick Popovici, the Founder of Vita Mojo restaurants & OS discussed on our podcast last week whereby both the operator and the guest must benefit for a tech solution to be considered worthwhile.

Many times, we’ve highlighted in our blogs that the best tech solutions are often those that do the heavy lifting for the frontline employees; empowering them to take on more value-adding and customer-facing tasks — where the human touch is essential for the experience. As best put by our podcast guest Griff Holland:

“Hospitality is about how you make someone feel, a robot can’t make someone feel, well, not yet anyway…”

Whilst a redefinition of job roles will seem exciting to many employees, it is important that hospitality and restaurant leaders identify those pessimistic about the impact it will have on their work life or those who deem the prospect of change too stressful. Poor employee engagement is disease to a successful change process, which is why priming your team and establishing the right organisational mindset for the digitisation journey should be the priority when beginning your digital transformation journey.

2. Plan for Success

Your employees are on board and your hospitality and restaurant business is in a state of ‘digital transformation readiness’. But before you go full steam ahead you should take the time to break down the change process into phases, steps and actionable tasks.

Digital transformation processes remain dubious across sectors yet they commonly take 5+ years to complete, it is therefore not surprising that so many companies fail due to a lack of thorough planning and patience.

And while digital transformation in hospitality and restaurant business may be less transformative and large scale than that of other sectors, hospitality’s narrow scope for profit means that budgeting the necessary resources is crucial for ensuring that your business has what it takes to push the project over the line and make it sticky.

This includes identifying what is needed from everybody in the organisation, what their current work demands are and how can the business facilitate the most effective coordination of people throughout the process without harming the day-to-day operations. On the store level, managers should reflect this in the way they staff their stores and schedule their team.

The planning phase should also involve the evaluation of how the digital transformation may impact the customer journey and at what stage are customers going to be engaging in the transformation process (assuming that you are implementing a digital solution has customer-facing elements).

We always walk through the employee and customer journeys with our clients when implementing a digital solution; using them as a visualisation tool for where the greatest impact is likely to occur — see examples below.

Whilst these are simple examples, we recommend the very comprehensive guide to mapping your customers’ journey in Kamila Sitwell’s book Bespoke — of which she provides further context to on our podcast.

In terms of selecting a customer-facing technology, if we could give one piece of advice it would be that you seek input from your frontline employees — those that know most about the experiences of your customers. They will feel more responsible for bridging any knowledge gaps and will be more likely to advocate the change; contributing to increased customer adoption.

Prior to the actual implementation, restaurant and hospitality leaders should also review and rank tasks based on how critical they are to the project’s overall success. Not only will this help to produce a coherent outlook on what tasks must be completed and by who, but also an indication of the minimum resource requirements to see the digital transformation through to the end.

3. Execute & Project Manage

But assuming that appropriate planning has been undergone and that the resources required for the digital transformation are available, the project management step of the digital transformation process involves the organised execution of all necessary tasks within a deliberate and specified time frame.

Many hospitality and restaurant businesses will not have the resources to appoint a dedicated PM to their digital transformation process, however, the general approach and ethos of effective project management should be incorporated into any digital transformation process. This can be characterised in:

  • The appropriate allocation of clear and actionable tasks;
  • An emphasis on the day-to-day monitoring of the digital transformation progress;
  • Bringing departments together so that the business moves as a unified force — not just siloed departments;
  • Ensure those within the organisation adopt a mindset focused on creating value for the key stakeholders — it’s more than just completing a personal to-do list.

Much like the planning phase, successful project management should identify and reinforce accountability throughout the organisation. In a restaurant context, this could be facilitated by a dedicated change team who each have their responsibilities clearly established.

Whilst it can be difficult in the day-to-day chaos of hospitality operations for restaurant businesses to deploy throughout and structured change programmes, failing to do so can massively impede the employee experience, the success of the initiative and the inter-store consistency of a multi-site chain. Which is why establishing the right mindset, planning the process & resource allocation and effectively executing & managing the transformation process from start to end is crucial for protecting your restaurant business during periods of digital transformation.

Final Thoughts

Regardless of your business size, we recommend that you take small steps towards preparing for digital transformation in your restaurant business; ensuring that your people feel part of the journey (and responsible for the success) of the initiative.

We have more and more hospitality and restaurant businesses seeing digital transformational as ‘crucial’ in achieving a competitive edge, although it’s evident that many do not foresee the difficulty of successfully digitising their business nor the threats to the experiences’ of their most crucial stakeholders.

But with the right deployment of resources at the right time, an appropriate tech solution can be the only way to fulfil your business strategy and the ever-changing demands of your employees and customers.

if you are considering digital transformation in your restaurant/ hospitality business, here are 5 Maverick-inspired questions to consider:

1. How digital is your restaurant business in the following areas on a scale of 1–10:

  • Employees — back of house:
  • Employees — front of house:
  • Customer fulfilment:
  • Recruiting:
  • Training:
  • Inventory management:
  • Marketing:
  • Food delivery:
  • Scheduling:
  • Supply chain:
  • Health & safety:
  • Internal comms:

2. How ready is your business on a scale of 1–10 to take on a digital transformation project?

3. What are our peers within the industry doing and what have they had success with?

4. How are the employees and customers interacting with digital solutions now — successes and failures?

5. Who do you have in your organisation that would be able to lead/ co-lead a digital transformation process?

Once you have identified your restaurant business’s gaps and priorities, you can consider strategies and the route to digital transformation.

Remember that the digital strategy is not something that should stand alone, but should be an integrated part of the overall business strategy. Remember don’t just start implementing digital tools without being sure that it makes sense for your employees, customers and the bottom line.

Like anything else, nothing gets great without strong implementation, and getting people from the frontline involved from the outset is key to the success of creating a digital business — because they are the ones that are going to bring it to life.

Please let us know what you think and share your ideas here, or, if would like a conversation about tech, hospitality and/ or restaurants please reach out to hello@hospitalitymavericks.com

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Oliver is a business graduate with over five years experience working for globally recognised restaurant chains. Besides when he’s surrounded by food, Ollie is in his element when he’s rethinking operational systems with the primary focus of enhancing employee and guest experiences.

Michael is a heart-centred operations and people specialist, who believes and lives by building hospitality and restaurants businesses from the inside out. When your employees love your company, your customers will love you — brand nirvana. He helps leaders and operators to build unique blueprints and business systems that create strong employee and customer experience through implementation, which translate into improved sales, profits and positive impact.