May 23, 2018

What in the World is Shaking Up The Hospitality Industry?

How prepared are you for the revolution?

Once upon a time, not that long ago in the restaurant, food and hospitality industry, the formula for success was pretty simple to grasp. Following the formula was widely accepted as the guaranteed path to making it.

Founders and business owners typically followed this tried and tested blueprint and reaped rewards.

  1. Create an original concept or innovate around the edges of an existing one.
  2. Clone the business D.N.A and replicate the customer/guest experience model.
  3. Standardise the systems and processes, implement them as uniform standards and roll them out across new locations.

Et voilà! You have the three steps to scale your single unit business into a hotel chain or restaurant empire.

Many of the global brands we are familiar with started out in this way. Small single unit business rooted in one location which then expanded in local markets and spread their reach and influence to dominate globally.

You are familiar with industry titans such as Starbucks, McDonald’s, Hilton Hotels and Resorts, Four Seasons Hotels and Resorts et al.

In their startup phase their leaders challenged the conventional thinking of the time about how businesses were run in the industry. As rebels of the day, they championed innovations in internal systems by building then unheard of efficiency into processes. They re-imaged how customers were served and how guests experienced their properties in new and distinctive ways.

The Cost of Success

Success has come at at high price. Leaders and business owners adopted the quest for efficiency with zeal. As a consequence, creativity, uniqueness and humanness landed on the chopping block. In recent decades, we have witnessed an overzealous trimming of these core ingredients that, truth be told, are the rich source of innovation which transformed an industry.

Their drive to squeeze the maximum output from resources; and get results in the least amount of time, energy and money has caused unintended adverse effects.This has likely squashed the very things which brought the hospitality leaders and businesses success in the first place.

The goal to scale the business has led to a ubiquitous brand presence that bores instead of delights customers/guests. Furthermore, the mission to standardise for profit and maximise shareholder return on investment has succeeded in numbing instead of engaging employees, ultimately dumbing down their capacity to make their individual contribution to the business.

The tried and tested formula has led to a saturated market of cookie-cutter experiences for which customers are losing their appetite and employees have a stomach full.

Over the last years, a ripple of change trickling through the industry has been building in intensity.

From relaxed bistro to fine-dining and from 2 star to the ultra-luxe, customers/ guests are staging an uprising. They want to feel an authentic, personalised, frictionless experience every time. Service levels in keeping with the class and budget of the business are expected; but a uniquely human and tailored guest/customer experience is demanded. Simply put, the cookie cutter experience is no longer the flavour of the day.

There is a new breed of restaurant entrepreneurs and hospitality leaders who hear the cry and are heeding the call to act. They understand the appetite for change is growing and are ready to deliver the experience their customer/guest wants.

The hospitality industry remains a brutal place from which to create a profitable business and stand out from the crowd. Surprisingly these new mavericks will find it much easier to break free from the sea of sameness and may even create a new understanding of what success means too.

From our respective work bases in the Caribbean, the UK and Central Europe; unknowingly these 3 questions were playing on both of our minds.

  1. Who are these mavericks?
  2. What are they doing that defies convention?
  3. How prepared are we, our clients and you for a revolution?

With this blog we have joined forces — setting out on a journey to discover the answers to these 3 questions and share what we learn with you.

We are following the trail wherever it leads us to understand what these maverick leaders are up to and what makes the maverick and their organisations tick.

We are curious to learn what they must master in order to build a sustainable business, an enterprise that creates great employee and customer experiences with humanness at the core; whilst simultaneously making a positive dent on the world.

Who are these mavericks daring to shake up the industry?

The new players and innovators entering the industry ignoring conventions and writing their own rules.

Let’s find out who are the rebels shaking up the hospitality industry.

Some are escapees from established restaurant and hospitality companies. Individuals who may have “struggled” in conventional settings where they felt their skills and values to be compromised.

An increasing number of unorthodox enterprising individuals have no experience within the industry.

“It may surprise you to learn that the Korean-American rebel chef David Chang, known for his delicious, creative food and brash, edgy attitude, majored in religion at preppy Trinity College in Hartford.”

These outsiders are free from the ‘curse’ of established industry knowledge. Furthermore, they are hungry to bring fresh ideas and ways of doing things from elsewhere. They operate with an openness to collaborate across industry silos to raise the bar and stay relevant.

No matter their origin, they all have an almost uncanny ability to get people on board to rally behind an idea or cause that defies current thinking. It takes a master builder and connector to see bridges where others only see barriers to entry.

These socially-minded entrepreneurs and conscious business founders are saying to heck with the blueprints of the old familiar business models. They approach business with a different mind-set, core beliefs and unique definition of success. They are focused in building sustainable businesses that make a dent at the universe; which means making profit in order to serve people and positively impact the planet before satisfying shareholders.

To make it more tangible here are three mavericks examples from the band of rebels shaking up the industry.

  • Sweet Green is a modern fast casual restaurant chain serving simple seasonal food. It was founded in 2007 by three friends Jonathan Neman, Nicolas Jammet and Nathaniel Ru who had recently left university; frustrated they could not find a place to get healthy food as well as a great experience. Ru recently said this about why they are in business; “We wanted to create a company and brand around human connection,” he explains. He went to compound their shared belief that food and eating are social experiences that need to be cultivated. They now operate more than 72 stores across the USA.
  • Founding Farmers is an American fine-causal chain founded by a collective of 47,000 family farmers who own a restaurant chain. They believe that everyone should be able to enjoy high-quality food that is delicious, and grown with care. They now operate more than 4 units in the Washington area and more in the pipeline.
  • Peacock Pavilions is a boutique Marrakech hotel founded and built by the writer and human rights specialist Maryam Montague and her architect husband, Chris Redecke in 2007–2009. What originally started off as a pair of global nomads’ desire to put down roots in a private home with their young family, morphed into an eco-hotel when the local council insisted they had to build something that benefits the community. Fast-forward to today, this hotel is an integral part of a design, hospitality, humanitarian brand with the M.Montague Souk, and an interior design sourcing service, and Project Soar, a non-profit organisation established to empower underserved girls and women.

What are they doing that defies convention?

It is easy to be seduced by their rule breaking, risk-taking and difference. But when we started to take a closer look at these change-makers, we noticed a pattern of 6 similar unorthodox behaviours and mindsets.

1.BOLD INTENT AND IMPACT: They are determined to build an organisation that does more than serve customers and delight guests or solely build profit. The business is a vehicle that delivers a positive impact to help fulfil a higher purpose bigger and beyond the founders’, the customers’/guests’ and employees’ needs.

More than opening a restaurant, food or hotel business, their enterprise is geared to addresses local community concerns or tackle more global challenges in real and meaningful ways. There is a willing acceptance of personal responsibility, community accountability and a concern for the unique footprint and legacy they leave. This intent and desire to make an impact powers their purpose. The story of how the MMontague brand came into being is a perfect example of an organic blend of personal values and social conscience in business. Their business mantra is simple.

“Be Good. Make Good. Do Good.”

2.AUDACIOUS PURPOSE BEYOND MAKING MONEY: Hospitality Mavericks are creating businesses with a conscience, invested with uncompromising worth and has it’s own value and definition of success. Making money is important but it serves their purpose — the famous “Why”. They are crystal clear in why they do what they do; and the benefit it brings to the world by tackling a problem worth solving, easing a frustration or curing a pain for themselves and the members of their community.

As conscious founders and leaders, the organisation’s culture is an authentic expression of their values and is in harmony with their own belief systems. Values are a public declaration of what they stand for and they act like a powerful magnet, attracting customers/guests and employees who share the same beliefs and principles.

Welcome to Death Wish … coffee that is. The Death Wish Coffee Companyis the top online coffee-seller of fair-trade, organic, high-caffeine blends, and home of the world’s strongest coffee!

Founder, Mike Brown, saw a need for coffee that was both strong and delicious to serve his groggy, morning customers. Serving that need fuels an audacious, uncompromising mission.

“Our mission is to fuel you wherever you go. Death Wish Coffee is made by passionate people for passionate people. We strive for the best tasting and highest quality organic and fair trade beans in every bag. Our processes are USDA certified and we have committed to sustainability throughout our products. We offer a 100%, no-BS guarantee: if this isn’t the strongest coffee you’ve ever tried, we’ll gladly give you a refund.”

Maverick-spirited businesses like these are built for people, by people. Purpose and principles are used to build communities where their employees and customers are mandated hold them accountable for doing business and behaving in accordance with these values.

Their community is the business’ collective conscience and values guardian. They are fully aware and accept that power lies with the people when it comes to their brand. These days everyone has access to their own media house, and your customers/guests and employees have free access to their own megaphone through social media — to share their experiences (both negative and positive) and mobilize action for or against a business or cause.

Maverick-spirited businesses are built for people, by people.

3.DECLINE TO SCALE FOR THE SAKE OF SCALE: They stay relevant and ahead of the competition by constantly creating value for their community. Their eyes are fixed firmly on their community pains and aspirations; not on what the competition is doing (or not doing).

Some decline to scale, deciding to restrict their business to a particular size and preferring to focus on profitability instead of growth. Bo Burlingham’s book Small Giants: Companies that Choose to Be Great Instead of Big is an excellent source of intelligence about maverick founders and leaders across industry sectors who choose to be remarkable in their field instead of chasing growth for the sake of growth.

Others decide to scale their businesses; but they keep a pre-scale mindset and act small as they grow. They say no to many opportunities, anchoring their success to their ability to say no to things that do not fit with their core values and mission.

They understand the value of scale and can see the advantages for getting bigger. For them, bigger means more influence and the ability to make a larger positive impact on the communities they serve and the world. But they accept if they grow to fast, they potentially compromise risking their culture or what many of them refer as the soul of their business, which means losing the magic and the uniqueness that made them be able to be attractive for employees and customers.

Union Square Hospitality Group, founded by restaurant entrepreneur Danny Meyer has always been very aware of saying yes to opportunities only if they were ready. Ready does not mean solely from a finance and systems point of view. Ready includes this, and critically, ensuring that there is enough relevant individual employee capability, collective talent and management capacity to scale. It can take years for a “yes” to a venture because it has to be right for the company’s culture too.

4.DIVERSIFY ACROSS BOUNDARIES: Let’s take a closer look at David Chang. Rebel chef turns international restaurateur, then start up food delivery entrepreneur with limited edition Nike sneaker deal.

Where is the common thread?

These new-school mavericks create unexpected business ventures across different business models; all of which are connected by their values and help to fulfil their purpose. Each new venture expands their reach and influence. But they take care to ensure new product or service launched continues to resonate with their customer and employee tribes and the communities which the business serves.

5.CREATE A STORY-BASED CULTURE: Stories guide how these organisations’ cultures are created and cultivated. A compelling founder story of the business’ development journey from idea to reality, brought to life with the characters encountered along the way, the challenges and obstacles faced and the triumphs; become a cornerstone of the organisation’s culture. The story resonates with their community. Employees and customer/guests emotionally connect with it, and adopt it as legend. They keep it alive by retelling and sharing the story; and together with the founders/leaders, they write the next chapters as they help to evolve and grow the business as a community.

According to Innocent drinks’ story, the business was voted into existence by its early adopter customers. Here is an excerpt in their own words.

“We started innocent in 1999 after selling our smoothies at a music festival. We put up a big sign asking people if they thought we should give up our jobs to make smoothies, and put a bin saying ‘Yes’ and a bin saying ‘No” in front of the stall. Then we got people to vote with their empties. At the end of the weekend, the ‘Yes’ bin was full, so we resigned from our jobs the next day and got cracking.”

6.LEADING: Mavericks accept that as leader, their primary responsibility is to serve — their employees, their customers/guests and the wider community which their business touches. Operating systems and technology are selected to amplify human impact, connection and contribution to the business; not to replace or enslave people.

The clever and wise ones have created their own alchemy. They have cracked the code transforming a movement into a sustainable business without losing the passion that fuelled the movement in the early days. Now, they lead a movement with a crystal clear purpose, vision and values that put the human at the heart of the business. From this vantage point, they are able to create environments where people understand what expected, why they are important and how they can make a contribution to the organisation’s success whilst simultaneously serving a higher purpose.

Friska is a UK national café chain with 7 units and more to to come. They are on a mission to redefine the way your breakfast and lunch place makes you feel.

One of the founders Griff Holland said this in a recent restaurant leadership talk in London about creating an authentic experience; and the relationship between service and empathy (care) for others.

“We actually think the way it’s served is just as important as the food itself. Truly memorable service doesn’t come from scripts and remembering to offer a loyalty card, it comes from people who really care about the way they make others feel and take real pleasure from making someone’s day.”

They have a clear goal of becoming the best employer in the industry. He made it very clear that as founder and leader, his role is to serve and make the team feel safe before anything else. This ethos is the key to building a remarkable organisation and successful business. He is a big believer that you eat last as a leader. For him that means you pay, develop and make your employees feel empowered before you take care of yourself. If you do that; profit and business impact will come.

Friska’s business model goes beyond serving their people, breakfasts and lunches. They are committed to make a positive social and environmental impact wherever they can. As an example they give 10p per sold water bottle goes toward supporting Frank Water and all of their charitable work around the world.

How prepared are you for the revolution?

Many operators across the globe are struggling with a host of emerging crises. Take your pick from growth challenges, rising food costs, intensive competition, critical skills gaps, technology adoption, rising employee turnover, changing customer tastes and shrinking guest loyalty (guaranteed year on year repeat business).

Each of these challenges either on their own or combined, have the makings of the perfect storm.

Opportunity or disaster — are you ready?

Many leaders in the industry are dangerously planning the future of their business but operating with their minds rooted in the past. An overconfident reliance on false assumptions about their customers’/guests’ expectations and employees’ desires is laying the groundwork for their demise. Don’t be one of them.

Today, standing still is the riskiest action you can take. The business landscape is littered with the broken and sad remnants of companies whose leaders failed to adapt to change.

The revolution is already taking place in the hospitality, food and restaurant industry.

“Things are changing so fast in food that if you’re still using what worked for you in the past, you’re screwed.” David Chang on why he is risking his perfect restaurant record for a delivery startup venture.

Whether you are of the mind to launch a startup venture or you are the leader of an existing restaurant, food or hospitality business, this is your call to action. Your organisation’s survival depends on it.

Yes, we know it is not easy. The reality is that there is no quick fix formula to create a sustainable, unmistakable business and culture.

But you can make a start to future-proof your business today. Here is how you can prepare to start your own revolution.

Use these 9 maverick-inspired questions in your team to kickstart the journey to a stronger and more sustainable business that your employees and customers will connect and fall in love with.

1. What do you offer that can’t be found elsewhere? - Hint: It might not be what you offer; but how you offer your product or experience.

2. What makes you stand out from the crowd?

  • A distinctive style?
  • An unforgettable customer/guest experience?
  • A remarkable culture?
  • A useful and valuable product?

3. What is your unfair advantage?

  • Why?

4. How are you leading in your community?

  • What do you dare to care about?
  • Who will you help?

5. How do you serve your customers/guests?

  • What pain do you solve?
  • What are they struggling with?
  • What aspirations do you help them achieve?

6. How are you leading your employees?

  • What connection are you making?

7. How clear is your purpose?

8. What do you stand for?

  • What are the values connecting you with your employees and customers/guests?
  • Are you communicating, connecting, hiring, reviewing, rewarding, and firing around them?

9. How clear and credible is your Vision for the future?

  • Do you have a clear road map to get there?
  • Are your employees, customers/guests on that journey with you?

Take your time. The revolution is not going anywhere.

Honest answers, no matter how uncomfortable, are the ticket to putting your business on the right road to sustainability. Success that resonates with you and your customer/guest and employee communities beckons.

Our journey continues and you are invited to join on this expedition. Let us find out more about the mavericks and rebel entrepreneurs who are defying conventional wisdom and blazing their own path.

What can we learn from them?

We are curious about their activities and thinking; and are dreaming up ways we can help them shake up an industry and change the world.

Tell us know your thoughts about the revolution sweeping through the restaurant, food and hospitality industry in the comments. We would love to read them.

Share this post with friends and colleagues who also have a strong passion for the hospitality industry and its people.

Before we sign off, a small note of caution. This post is best sent to folks who are curious and open to joining and supporting a revolution.

Michael is the heart-centered operations pro, 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, which translate into improved sales, profits and sustainability.

Michael is the founder and implementer of Tingsager Consulting and Co-founder of The Bear Kitchen with real-world experience in managing multi-unit restaurant operations and working with global brands.

Nicole is a warrior dedicated to liberating business owners from the HR-related chaos and the insanity than can threaten a successful opening and the growth of sustainable business. An HR pro that thinks like a creative, she helps leaders and operators put the right team and HR systems in place, connect their people to the purpose of their business so that they can create a unique customer experience that generates revenue and loyalty.

Nicole is the founder and lead creative HR specialist of Aquarius Human Resources Consulting; with a love for hospitality she supports the launch and operation of luxury brands, independent restaurants and boutique hotels. She is a guest blog contributor, tweeter and writer at The HR Rabbit Hole blog.