Employees behaving badly. It sounds more like a B-rated movie than a scene your customers should witness, and for good reason. Researchers at University of California Marshall School of Business and Georgetown University found that employee conflict negatively affects customers as much or more than employee rudeness directed at them. And the bad effects are profound.

Lead researcher, Christine Porath, co-author of The Cost of Bad Behavior reports that 80 percent of people who observe employee incivility said they wouldn’t return to the establishment. And it gets worse. 83 percent tell family and friends. “Bad reports spread and can ruin reputations,” Porath says.

For restaurants, a pleasant environment is crucial. At The Glendon Bar & Kitchen in Los Angeles, owner and managing partner J Wolf fosters a relaxed working environment, encouraging employees to get creative and have fun. However, Wolf says, “I lay it all out there to employees when they’re hired. Business comes first.”

Wolf strives for teamwork. “Nobody can just sit on their island and take care of their own thing.” He addresses disputes immediately. “The second somebody steps out of line, business isn’t being taken care of,” Wolf says. “Our customers are our business. Employees are all aware, if business is hurt, their jobs might be hurt.”

A new technique outlined in the book, The Exchange: A Bold and Proven Approach to Resolving Workplace Conflict advocates giving workers a stake in positive outcomes.

Co-author Steven Dinkin, president of The National Conflict Resolution Center, says the strategy empowers management to help feuding employees address issues before they escalate. This training in specific communication techniques gets to the root cause behind disagreements.

The strategy may reveal weaknesses in how interactive tasks are performed. “In a restaurant,” Dinkin says, “wait staff may learn the cook needs orders presented in a different way, for example. Employees then brainstorm changes and come up with an agreement.” Solution buy-in makes it effective.

Since The Glendon Bar & Kitchen is only a year old, Wolf says he learns every day. As such, he welcomes employees’ ideas. A bartender’s drink creation was a featured special, and a pizza recipe modification was named after a cook. Everyone strives for the restaurant’s success. The relaxed, collaborative environment works, although Wolf admits to more structure now than when the restaurant opened last year.

Steady Success

The Greene Turtle Sports Bar, an East Coast franchised chain begun in 1976, has a solid framework behind its fun, teamwork culture.

“It starts with the interview,” says Jennifer DeMent, director of training for The Greene Turtle Franchising Corporation. “We prepare individual unit managers to speak about our culture so the person interviewed understands, believes, and can buy into that culture.”

Twice daily pre-shift meetings inform staff of the day’s happenings, current promotions, and incentives. “We discuss teamwork so customers get the best service possible,” says DeMent.

Corporate-supported incentive programs at The Greene Turtle revolve around customer service, and are used to boost team spirit. For example, a $100 money chain is hung up in the back of the house and $1 is removed from it every time an order goes out late.

The employees share what’s left at the end of a shift, so they work together to get orders out in a timely fashion.

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Companywide contests, called “turtle-titions,” pit stores against each another but increase staff solidarity in individual stores. When one team member takes the lead, staff rallies around, roots for, and assists that employee so their restaurant wins. The prize is bragging rights, and a turtle trophy on display.

The Greene Turtle has a zero-tolerance policy for serious disputes. For lesser issues, managers are trained to take the problem out of customers’ view. “Praise in public, criticize in private,” DeMent says.

“We don’t want our customers to have any sort of negative experience,” DeMent says. “So we’re proactive from the new hire process. We train employees to be mindful of customer experience. It’s a home away from home, and should be treated as if you’re having friends over all the time.”

The positive environment benefits staff too. “Employees tell me they can just drop all their troubles at the door,” says DeMent. “They have fun while at work.”

Setting Expectations

At Traffic Jam & Snug, a 280-seat microbrewery and restaurant in downtown Detroit, co-owner and chef Carolyn Howard says she’s rarely had employee problems. She’s heard other restaurants say their biggest problem is their employees, but considers her 70 employees an asset.

Howard, who has an M.A. in industrial relations, stresses teamwork and communication. She tells employees, “Until you leave here, you are a cook, or you are a hostess, or you are a waitress … This is your career and you need to be the best you can be, because this is what you do right now.”

Howard gathers staff at each shift’s start. “We are constantly training,” she says. “Every employee needs to know what’s going on so factions —floor managers, hostesses, cooks—work together. We’re all on the same page, so things run smoothly, and customers have a good experience.”

Rather than promotions or incentive programs, Howard believes in the importance of intangibles. “I started an employee meeting a couple of weeks ago by telling them how great they all are,” she says. “They are all hard working people. We create an atmosphere where employees are valued and comfortable and essentially happy to work there. That feeds into customer experience because staff is friendly, approachable, and happy. Everyone is knowledgeable, so the restaurant is prepared.”

Howard’s upbeat attitude and commitment to training are effective. Some employees have worked at the restaurant for more than 20 years. Continuity is good for business. Howard says: “When teamwork is done right, there is no stopping us.”

Positive Payoff

Whether using tangible or intangible incentives, instilling brand culture, or relying on training backed by structured communication and respect, all eateries benefit from an atmosphere of teamwork and employee support.

While bad behavior can be devastating, good behavior leaves a lasting positive impression. Porath, the author, says customers who witness positive employee interaction report more certainty about being treated well, getting good service and returning to eat there again.

DeMent has it right when she says her company’s cute turtle logo often draws people inside. “But it’s the friendly, fun atmosphere that keeps them coming back.”