If your business is in trouble, look to your staff to help move things forward.
July 1, 2004
RH Staff
To turn around the performance of any troubled business, particularly a restaurant, a new leader or change agent must gather information in the shortest possible time. The financial side has numerous ways to analyze the situation. The business manager, outside accountant, auditor or lender analyzes and verifies cash flow, profitability and key ratios.
Other questions demand tougher answers. Why did the restaurant's or the chain's numbers fall? When management first became aware of a downward trend, what action was taken? What is management's current plan for resolving the problem? How many people in the organization have the accurate story on the business' current status? Are the right players in the right positions to chart a new course?
Your challenge is getting answers to these questions as quickly as possible and combining them with the operation's financial data to obtain a clear picture. This requires involvement from everyone at every level.
The common denominator for gathering information across all levels is to establish trust quickly. When individuals hold back, it consumes valuable time. Gaining the trust of employees requires overcoming their fears, the most obvious of which is job security.
Whether or not your restaurant has reduced staff or cut staff hours, your employees have seen many indications that the business is not doing well. Often, they fear that sharing information will cause them to realize their worst fears. Here are 10 ways to encourage employees to share vital information.
1. Investigate. Invariably, businesses have old reports and plans buried in files that have addressed some of the problems. Regardless of how little credence was given to those earlier efforts, it's worthwhile to review these reports. Invaluable insights can be gained by asking why key recommendations were never implemented.
An effective technique for ensuring that all earlier reports have been identified is to ask managers to list prior change initiatives chronologically. Compare these lists for omissions, which can save considerable time and identify potential barriers that exist within the current management.
2. Analyze. The combination of financial data and previous reports provides a foundation for a preliminary analysis. It's critical to develop a clear, concise summary of the business's vital signs and share it with employees. It's surprising how many people within a troubled company don't clearly understand its condition. You must fill this information gap quickly.
It's critical to develop a clear, concise summary of the restaurant's vital signs and share it with employees. You must fill this information gap quickly.
3. Communicate. It's common for businesses to hold regular “town hall meetings.” These meetings may not have communicated the real plight. Sometimes only part of the story is revealed. As early as possible, hold company-wide meetings that summarize data developed to date. It's common for operators to object to such an approach, claiming that the company will lose good people if information is shared, but how can good people contribute to a successful turnaround without the facts?
4. Share. Sharing information is painful, but necessary. The more information a leader shares, the more ideas you'll get in return. The information should be clear, factual, and to the point.
If you have a small operation, everyone can meet at one time in one place. In larger organizations, several meetings will be necessary. If multiple meetings are necessary, it is far better to have cross-functional groupings because they have a leveling effect: They communicate to employees that all roles are important to the successful turnaround of the business and that they need to work as one team.
5. Gather. Your effective communication in the operation meeting made it clear to everyone why urgency is needed. Your next step is to gather information.
Leaders commonly assume that one-on-one interviews should be conducted next. They should not. Despite wanting to help, employees at all levels are concerned about losing their jobs, and they may not be forthcoming in one-to-one interviews. To provide them with anonymity, ask them to respond to open-ended questions in writing that are turned in to a neutral third part for processing. The results can be shared with everyone, creating a generous flow of ideas.
Regardless of the how you conduct your survey, the questions should be constructed carefully to guard against suggestive or leading questions. Poorly designed questions can shut off a flow of ideas.
6. Match. Once you've shared the survey results, you have an opportunity to ask employees to identify their skills, knowledge, and abilities. Of particular importance are skills that are underused. Whenever reorganization takes place, the key is to match the right people to the right positions. Unless people are asked about their career path goals, key opportunities can go unnoticed.
7. Compile. When employee meetings have been completed, compile the information. A complete organizational chart is absolutely essential to serve as a road map for meeting with people. Names are invariably omitted from the chart at first, so compare it to the current payroll printout.
Creating a confidential version of the organizational chart that includes each person's total compensation provides a tool that quickly reveals inconsistencies.
8. Interview. Targeted interviews are great timesavers. Armed with previous information, the analysis of financial data, employee feedback, organizational charts, and career path goals, you can target questions specifically to close gaps. Answers are far more revealing when the stage is set with facts.
9. Implementation. Most plans for change fall short during implementation. Employees are reluctant to aid in implementing change if they were never asked for input to begin with. This underscores the importance of sharing information with employees and gathering input from them from the beginning.
Change is always easier when it is initiated from within, rather than imposed from the top. Not only can you gather input with urgency, you can also create an atmosphere in which employees drive the change. When this happens, they often respond with comments such as “These changes were necessary and long overdue. Thank you for taking action and making us part of it.”
10. Update. If everyone is kept up to date, they'll keep coming back with more ideas to help the business-through the turnaround. Even if financial circumstances worsen as a result of lost traffic or loss of a lender, it is important to keep everyone abreast of the facts. Timely feedback helps to contain the rumor mill, which feasts on partial information. Rumors can be disastrous to your efforts to maintain your customer and vendor bases.
Turning around a ship in rough waters requires that everyone get the same information so they can respond quickly and can start rowing in the same direction. If everyone is involved, a turnaround can be overcome in much less time...and time, after all, is money.
Gerry Murak, MBA, PHR, of Murak & Associates, LLC, is a consultant, executive coach, speaker and author of the upcoming book Straight Line into the Turn.”Contact him at www.murak.com.
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