At this stage in the pandemic rebound, operators are refocusing on the things that matter most to consumers.
Over the years, you may have been told as a restaurant owner that variety is the spice of life, but when it comes to great execution, consistency is critical, and variety is a recipe for failure.
For the past two years, our industry has faced a series of roadblocks that have made it difficult for operators to deliver great execution. Instead, their focus has been on simplification, off-premises growth, labor shortages, and now, inflation. At its core, a great foodservice experience starts with meeting customer expectations. Consistency is critical to achieving that.
Restaurants are not perfect, but for you, me, or anyone else to frequent an establishment on a regular basis, the restaurant must be close. But for operators, the truth is they don’t need to be; they just need to be consistent.
MORE FROM THE AUTHORS
The Evolution of The Restaurant of The Future
Journey to the Next Normal Part 3: Now is the Time to Play Offense
What Does the Foodservice Distributor of the Future Look Like?
Journey to the Next Normal Part 2: Supply Chain Disruption
Journey to The Next Normal: Labor Shortages and How to Overcome Them
This article focuses on how consistent execution has come back to the forefront for many operators through the summer and fall of 2022. That’s not because it’s now more important than before, yet rather because the challenges of the pandemic caused consistent execution to take a few hits.
BARRIERS TO GREAT EXECUTION
The first step toward great execution is to understand what prevents it. According to Kinetic12’s Emergence survey of 100-plus emerging and growth chains, a lack of qualified labor is the No. 1 barrier impacting great execution—83 percent of operators surveyed identified this as a top five hurdle.
As the survey shows (below), there is a long list of things that can impact execution. It’s no wonder it’s so hard to achieve.
Of course, understanding what the barriers are is the first step to addressing them. This requires operators be open-minded to change and have the ability to pivot.
Naturally, consumers are not interested in what causes poor execution. They are only interested in results. That leaves the operator with the task of figuring out how to deliver it. And they need to do it quickly before the inconsistency drives the customer elsewhere.
EXECUTION and THE TOP BUSINESS ISSUES
Although “lack of consistent execution” was No. 11 on the Emergence survey of top business issues (see below), it must be noted the top 10 issues have a direct impact on execution. Issues 1–10 are problems that require corrective measures that are not easily achieved. They are also NOT issues that the consumer cares about, even though they may have an understanding and compassion for the problems. It is No. 11—execution—the consumer is most concerned about.
- Rising cost of ingredients and the decision to take price increases
- Supply chain disruptions- fill rate issues
- Staff shortages affecting service level standards
- Labor- hiring quality staff
- Building and opening new stores on time
- Driving traffic & customer loyalty
- Labor- Retaining staff
- Availability of packaging
- Inadequate communication from suppliers on supply chain issues
- Off-premises optimization
- Lack of consistent menu execution
EXECUTION and LTO STRATEGIES
Limited-time offers used to be about complex, highly marketable, differentiated menu items. It was about wowing the consumer. Over the past two years, there has been a move to simplicity when it comes to LTOs. This is reflected by operators in the survey results below.
In our most recent Emergence survey on LTO strategies, “easy to prep & execute” was identified as the top LTO strategy, followed by “avoiding complexity” at No. 2.
Clearly the pandemic has impacted how operators approach short-term innovation. Success is not measured by how many, but rather by the quality of the idea and how easily it can be managed within the constraints of the new operating environment.
EXECUTION and THE INNOVATION MINDSET
Ease of execution is also part of how operators think about innovation as a whole. When we examine operator’s overall innovation mindset, we clearly see a new approach being adopted. Sticking to the brands core, simplicity and ease of execution are defining how operators now view innovation.
For many operators, pre-pandemic menus had become too large, with too many single-use ingredients. This did create variety for the customer but at what cost? A kitchen’s capacity for new menu items and added complexity is not limitless.
Menus, SKU counts, and overall operations have undergone a dramatic simplification over the past two years. The new innovation mindset is the keep the menu smaller, innovate around what you are known for, and make it easy to consistently repeat.
The top six phrases describing operators new innovation mindset are:
- Embrace change
- Stick to the brand’s core
- Based on consumer trends & insights
- Problem solving
- Creating more recipes from existing ingredients
- Keep the menu smaller and easy to execute
EXECUTION and REVENUE GROWTH
It is hard to imagine that the No. 1 response from the 125 Emergence chains regarding ideas to grow revenue was “more consistent execution.” In the previous seven quarters of this survey the top focus for revenue growth was catering, which due to the pandemic was logical off-premises large-check orders.
The fact that execution is viewed as a revenue growth idea at all, let alone the No. 1 idea, is proof of how critically important it is to a restaurant’s success, and proof that execution has suffered through the pandemic.
THE EXECUTION MINDSET
When Kinetic12 first wrote about the Restaurant of Future back in Q2 2020, we projected that the COVID-19 pandemic would have a significant long-term impact on the design and operation of restaurants. We projected restaurant footprints would become smaller, and the operation would become simpler, more streamlined, and easier for fewer staff to execute consistently.
In 2022, our environment continues to evolve. With the dramatic growth of off-premise, persistent supply chain issues and inflation driving consumer demand for greater value, we now see a renewed focus on great execution. This is good thing, for both consumers and operators.
Given the extreme challenge of the last few years it is understandable that consistent execution has been an issue for operators. Moving forward, any investment in optimizing the operation, whether it’s designed to cut costs or build new capability, must also consider the impact on the team’s ability to consistently deliver.
Consistent execution is non-negotiable in the eyes of the consumer, and savvy operators know this. Now is the time to focus on the basics and execution excellence is as basic as it gets.
Bruce Reinstein and Tim Hand are partners with Kinetic12 Consulting, a Chicago-based Foodservice and general management consulting firm. The firm works with leading Foodservice suppliers, operators and organizations on customized strategic initiatives as well as guiding multiple collaborative forums and best practice projects. They also engage as keynote speakers at operator franchise conference and supplier sales meetings. Their previous leadership roles in restaurant chain operations and at Foodservice manufacturers provide a balanced industry perspective.
Contact us to talk or learn more about how we can help your organization understand the Restaurant of the Future and how Emerging & Growth Chains will define the future of Foodservice. Kinetic12.com Bruce@Kinetic12.com or Tim@Kinetic12.com