Industry News | September 17, 2012 | QSR Exclusive Brief

Want to Keep Your Employees Around? Here's How

(From left) Melissa Smith from FOCUS Brands; Fritzi Woods, CEO and president of the Women's Foodservice Forum (WFF); Lynette McKee, executive director of the NRAEF; and Marva Donaldson, WFF director of business development, were just a few of the attendees at the Dine America conference in Atlanta.
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Anyone in the restaurant industry, be it quick service or full service, can tell you employee turnover is one of the biggest issues facing the segment day in and day out.

And presenters from last week’s Dine America conference—QSR’s executive idea exchange held in Atlanta—couldn’t agree more. Fortunately, they were able to share their insights on how to retain employees and cut down on turnover.

Fritzi Woods, president and CEO of the Women’s Foodservice Forum, said turnover for hourly employees is a whopping 95 percent, while management turnover sits at 40 percent.

Not only is losing an employee an operational pain, but it’s costly, too. Woods said a lost hourly employee costs a brand around $700, while a manager can cost as much as $11,000.

This proves brand leaders can’t just focus on retaining hourly employees, Woods said; it’s about keeping your managers and leadership team around, too.

Randy Garutti, CEO of Shake Shack, said the key to keeping employees around is to turn one of fast food’s biggest “truths” on its head: Make limited-service dining a career option. If employees see a viable future as part of the company, they’ll be more likely to stick around.

One way Shake Shack does this is through its bonus program, where it takes 1 percent of its profits each month and spreads it among the staff. Garutti said this not only encourages employees to remain with the company, but it also motivates them to keep a positive attitude in the store even when they’re slammed and exhausted.

He also said it’s important to build a culture of team support and an environment in which leadership and staff take care of one another. Once employees feel cared for, he added, they can then take care of their guests, community, suppliers, and shareholders.

Michael Bergdahl, former director of people for Walmart, echoed this idea, adding that taking care of your staff is the ultimate way to serve your consumers (and boost your bottom line).

Bergdahl said a well-known Sam Walton phrase sums up this philosophy: “Take care of your people, your people will take care of your customers, and the business will take care of itself.”

Companies must also create a culture in which employees don’t want to leave your business, Bergdahl said. He added that establishing a service culture—one in which brands hire average people and seek to get above-average results from them in terms of customer service—is key.

One additional way Woods said brands can encourage employees and leaders to stay loyal to the company is through mentoring.

In fact, she said 95 percent of young managers are constantly looking for a new place of employment because they desire more mentoring, training, and coaching.

To view photos from this year's Dine America event, visit QSR's Facebook page.

By Mary Avant