Executive Insights | May 2013 | By Sam Oches
The most powerful woman in the restaurant industry isn’t intimidating, nor is she larger than life. She isn’t cold, tight-lipped, terse, or abrasive. She doesn’t talk down to you. She doesn’t double-book you and cancel at the last second.
Certainly one might expect such a person to be and do any number of those things; overseeing nearly 1 million members that collectively earn more than $650 billion in sales and represent 4 percent of the entire U.S. GDP isn’t a walk in the park.
But Dawn Sweeney is a different kind of leader. One who greets you by smiling broadly and taking your hand in both of hers. One who finds the time to listen to your opinion, looking intently at you as she does so. One who makes you feel like your time is valuable to her. Like a politician? Maybe. But not like a politician who just wants your vote; like a politician who genuinely cares about your success (should that person ever exist).
And woe to whoever confuses her warm demeanor for weakness. The president and CEO of the National Restaurant Association (NRA) is widely respected across the business world for her success, first at AARP—where she ran subsidiary AARP Services and was responsible for generating more than $700 million in annual revenue to support the organization’s mission—and now at the NRA, where she has helped restaurant operators in every category reclaim profits lost in the recession.
While it might be a heavy burden to bear, Sweeney sings a happy song these days.
“I honestly think the industry has never been in a stronger, better place,” she says, sitting in a dandelion-yellow corner office that stares down 21st Street in Washington, D.C. “Having had the challenges that we had over the last several years, I think it’s created an environment where the industry has really had to take a look at itself individually—and certainly at the National Restaurant Association, collectively—and try to identify the opportunities that we might not have taken advantage of in the past, other ways to build greater efficiencies into those operations.”
It’s not to say the industry is all smooth sailing. Sweeney says there has likely never been a time in its history when so many issues—whether it’s tax reform, health care, or food regulations—have collectively threatened operators’ profit margins. As she explains it, the NRA has a word cloud composed of the issues it’s helping the industry work through—78 of them, at last count—but that even as the leadership team celebrates accomplishments, new issues arise. She compares it to a daunting game of Whac-a-Mole where one felled mole pops up five, 10, 12 more.
But Sweeney has recently adopted a new saying from NRA chair Phil Hickey Jr., one she says helps focus the organization’s mission: “Replace fear with knowledge.”
“The industry we represent is amazingly resilient, incredibly creative, has a huge amount of perseverance at a time of difficulty, and is a can-do industry in what is often a can’t-do world,” she says. “My belief is that we need to mirror that industry in every way. … So what we’ve tried to do is to really establish the same work ethic, the same sense of excellence, the same eye for detail, the same resilience and professionalism that we see in the very industry that we represent.”
Resilience is a fitting term for Sweeney’s near-six-year reign as president and CEO. When she took office in October 2007, the industry was enjoying 18 consecutive years of growth. With little foresight into the impending cliff the economy would soon plunge from, Sweeney and her team developed a five-year plan that would focus resources on a handful of specific areas, including jobs and careers, food and healthy living, profitability and entrepreneurship, and sustainability and social responsibility.
Despite the recession, the NRA chose not to adjust its goals—which Sweeney says were “aggressive”—aside from giving itself six years to complete the five-year plan. She says the organization is still on pace to complete nearly all of its goals. “I’m very gratified as we begin thinking about the next five-year plan that we will have to do,” she says. “I’m very excited that the underpinnings of our original plan are very, very strong.”
At the heart of each success is Sweeney, who believes the word no only means “not yet.” Though she balks at calling herself a visionary, Sweeney qualifies her role at the NRA as being one that removes barriers for members, looks to future challenges, and, primarily, advocates for hundreds of thousands of constituents.
Understandably, doing so can be incredibly challenging, and not just because nearly 13 million people work in the industry. With today’s government as partisan as it’s ever been, Sweeney says, trade organizations like the NRA have to be creative in the ways they get favorable legislation passed. The NRA has pulled this off with some of the last few years’ successes, like swipe-fee reform, and today it is working with Congress on a number of issues, including immigration reform (which it supports) and minimum wage increases (which it doesn’t). There’s also food safety, unionization, tip regulations, packaging restrictions … the list goes on and on, all the way down to state and local legislation that affects restaurants.
Then, of course, there’s health-care reform.
“The health-care reform has been a huge priority for us for the last two and a half years, both in terms of influencing the original legislation [and] influencing the regulations that are in the process of being written; the definitions of the key categories of affordable care [and] employer mandate; definition of full-time and part-time employees [and] seasonality,” Sweeney says. “All of those things are critically important to what the impact is ultimately going to be on the industry.” When it became clear the Patient Protection & Affordable Care Act would remain the law of the land, the NRA developed tools and resources, like its Health Care Knowledge Center, to help operators sort through the reform.
Sweeney acknowledges the NRA generally enjoys better success with congressional Republicans, who are more pro-business than most Democrats. But she says that, no matter the issue, the NRA’s job is to find enough delegates to support restaurant-friendly legislation, no matter what party they might represent.
“My approach in particular has always been a proactive one that is nonpartisan, which I think gives you the best chance of success in any environment, and in this particular one, the proactive part is really important,” she says. “We were able to get the menu-labeling [mandate] passed in basically this same environment, which was pretty amazing with the pre-emptions, provisions, and those kinds of things that are typically not included in Congress with a makeup of this type.”
Indeed, the menu-labeling mandate, which passed along with health-care reform, was an impressive feat of nonpartisan strength. Though the labeling initiative forces extra costs on chain operators, who will have to post calorie counts to menuboards, the NRA supported it as a responsible step forward in the fight against obesity and took care to ensure the language was as favorable to restaurants as possible. The mandate is expected to go into effect this year.
Sweeney says she wants her legacy to be one of a leader who created better profitability for her constituents. That will almost certainly be the case. If she were to leave the job this year, people would also laud her push for better sustainability, which has included the launch of the NRA’s Conserve initiative, as well as her support of education. The NRA’s Educational Foundation has flourished under Sweeney’s guidance, especially its ProStart program, which trains high school students for future industry jobs.
But she might come to be better known as the leader who helped the restaurant industry finally take health and nutrition seriously. The menu-labeling mandate was only the beginning; in 2011, the NRA rolled out Kids LiveWell, an industry-wide program that helps parents and children select healthful menu options when dining out. Nearly 100 brands participate, including dozens of quick serves.
The health piece is simply the right thing to do, Sweeney says; more consumers are demanding better nutrition and deserve healthier options. But improving the lives of children is imperative, she says, especially in the quick-serve industry.
“I do think a lot of our efforts in the quick-service space, as well as in the rest of the industry, can be really successfully focused on kids, because they are our next generation of consumers,” Sweeney says. “There’s so much attention to them from all kinds of segments of the industry, but there’s just an absolute love and adoration for the [quick-service] segment that comes from kids. How do we build on that from an education standpoint? How do we help kids understand and learn what’s important about what they put in their body and the calories-in, calories-out message?”
Sweeney is actively searching for the right answers to those questions. She was a charter member of Childhood Obesity 180, an initiative of private, public, nonprofit, and academic leaders committed to fighting obesity, and was recently recognized by The Campaign to End Obesity for her leadership.
“I think over time we will find those answers in that intersection between government, business, and nonprofits,” she says. “We’ll all take a certain portion of effort. It’s not an issue that business alone can solve, and it’s definitely not an issue that the restaurant industry alone can solve.”
Much like in her work with Congress, Sweeney is being proactive when it comes to the role of restaurants in America’s health woes. Of course, she understands that some things are beyond her control. Food regulations, for example, are creeping into foodservice, and she says the NRA is trying to “proactively figure out how to do this in a way that’s going to be healthy to us.”
The best line of defense the restaurant industry has, Sweeney says, is the people and the stories that make up each individual operation. She stresses that the NRA is committed to highlighting those stories to showcase the positive change the industry is establishing.
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