Industry News | February 10, 2012

Wendy's Staff 'Reboot': A Good Move?

Wendy’s made waves last week when it announced during its fourth-quarter earnings call that it would be making service and experience improvements to compete more with fast-casual companies like Five Guys.

Executives at the iconic brand stated that they would expand Wendy’s new prototype, but it was another part of the strategy that resonated in the industry: The company plans to review all store employees—from counter employees to district managers—and do “a complete people reboot,” said Steve Farrar, Wendy’s chief operating officer, during the earnings call.

The reboot will entail keeping only "the five-stars" and "rounding out the crew with exceptional new hires," Farrar said.

At a time when unemployment is still high, the economy is still shaky, and job creators are universally praised, mass layoffs may strike some as being insensitive. But human resources experts say this strategy could pay big dividends for Wendy’s.

“Wendy’s could devote gazillions of dollars to new products, new marketing, reimaging, etc., but if they keep a lot of disengaged, poorly trained employees, then it will all fail,” says Joni Doolin, founder and CEO of People Report, a human resources research and analytics firm.

“From a very broad perspective, they are spot on in terms of identifying how critical it is to make that step.”

Doolin says Wendy’s initiative will likely be very expensive, and that it will “require a lot of communication and a lot of training.” But she says stores should see increases in same-store sales within three to six months after going through the reboot.

“These are not complex jobs,” she says. “Those standards and training should be delivered in a reasonable amount of time.”

John Kelley is the vice president of training and human resources for White Castle, as well as the incoming president of the Council of Hotel and Restaurant Trainers (CHART). He says improving a company’s in-store experience would either require training new staff or retraining existing staff, so Wendy’s would be in for a big investment one way or another.

With this method, Kelley says, Wendy’s has an opportunity to weed out staff members that may be dragging an entire team down. He says high-quality crew members tend to do better when surrounded by other high-quality crew members.

“People like to be working with other people that are like them,” Kelley says.

But for other companies interested in a complete “reboot,” Kelley suggests they exhaust all of their other options first.

“I think you want to make sure that you … have given every opportunity for those team members, and make sure they’re well trained,” he says. “Sometimes, despite your best efforts, there are people who have potentially become disengaged and you’ve done everything you can to try to engage them.”

Kelley also reminds that while it might seem like bad timing to lay off workers, the jobs themselves will not be going way. “There’s an awful lot of people out there looking for jobs,” he says. “While they might be putting some people back in … to the pool of unemployment, they’re going to be replacing them.”

Wendy’s might also be striking while the iron is hot. Because of the recession, Doolin says, there are many more quality employees joining quick-serve teams, and many more still available for hire. She says that while the fast food industry used to be perceived as an industry of teenage workers, today the average age of employees is closer to 30.

Also, while turnover in the industry historically hovered above 100 percent, she says the average today has “dropped like a rock” and is “well below 100 percent”—closer, she says, to pre-recession turnover rates of the casual-dining industry.

But turnover is starting to go back up, Doolin says, and 2012 will see more quick-serve companies snatching up top-notch employees.

“We are getting reports that the majority, over half, of quick-service companies who were involved in [People’s Report’s] Workforce Index this quarter plan on hiring additional staff,” she says.

By Sam Oches

News and information presented in this release has not been corroborated by QSR, Food News Media, or Journalistic, Inc.


There are pros and cons to this move. Many of today's Wendys Team Members lack the enthusiasm the once had. Again, not all. However, this is a management issue. The other issue is Wendy's and other fast food companies are requiring applicants to apply online. This is a bad system. Managers should see who is applying first so they don't call applicants in for interviews who are not well groomed or lack personality.

As a fish stinks from the head down, how 'bout a reboot starting with the Board of directors, CEO et. al. first. Or is this code for make the operation guys kowtow the party line or go join the masses on the unemployment line. Fire anyone with 10 years plus employment and replace them with people with half the pay. I wonder what Dave Thomas would have done?Anyone wonder why Panera does so well?

I could not agree more with a reboot of employees. At our Wendy's the counter people are rude not only to customers but to each other. It has been several months since visiting our local store due to the manager yelling at employees and then the employee throwing condiment packets through the drive-thru window at a customer.

One-time "reboots" tend not to work in the long run. It is likely it will be seen as an "initiative" or "program" rather than a way of doing business. Unless a company sees the labor line as an investment, rather than an expense, they will not make the right moves in creating well-integrated recruitment, selection, training, development and compensation systems. It needs to be a culture consistent with the brand positioning.

Interesting plan. In and of itself, on a wide-spread, corporate level, it's doomed to failure; of course this article may not tell the whole story.If Wendy's senior management plans to create a comprehensive plan to coach, counsel and develop underachievers and give them a chance to improve. then this plan should succeed. Without such a plan in place, simply trying to hire "5 stars", while getting rid of others will lead to a culture of mistrust, to say the least.However, individual restaurants should always approach the management of people and personalities from the viewpoint of a coach, and quite simply, sometimes a coach must make a decision to cut someone from the team.I should also mention that Wendy's plan is not revolutionary thinking. Following is a letter written by lengendary hotelier E.M. Statler, to the heads of his hotels. The letter was written in 1917; 95 years ago!HIRE ONLY GOOD NATURED PEOPLE!In 1917, E.M. Statler sent to the manager's of all his hotels a memorandum on how to conduct business. The principle contained in this letter is just as applicable today (if not more so) as it was in the early part of the last century, and it is applicable to ALL food and beverage establishments, not just hotels. This is the letter:From this date you are instructed to employ only good-natured people, cheerful and pleasant, who smile easily and often. This ought to go for every job in the house, but at present I'll insist on it only for people that come in contact with guests.It does go, from this day, for all department heads, front office people, cashiers, captains, elevator men, porters, telephone operators, and other employees who have to deal directly with patrons.And it isn't to be only a case of hiring. That policy is to govern all promotions; and you are to begin right now, to measure your present staff by it.If it's necessary to clean house, do it. Don't protest. Get rid of the grouches, and the people that can't keep their tempers, and the people who act as if they were always under a burden of trouble and feeling sorry for themselves. You can't make that sort of a person over; you can't do anything with them profitably, but get rid of him. Let the other fellow have him and you hire a man that can be taught.You want to lessen complaints, don't you? You want your organization to run more efficient don't you? Well, I've been studying this one idea for months, and I'm convinced that it will help solve several problems that we have - of complaints, of competition, of handicaps we've had in certain spots. Not immediately, perhaps, not tomorrow, or in the middle of next week, but there will be noticeable improvements just as soon as it gets along.Unless - unless you and your department heads are indifferent or antagonistic, in which case you'll want to go on just as before, without giving it a trial.But, I've decided on this, and I'm going to do my very most toward seeing that it does get a fair trial, and that it gets the same attention and respect and adherence as any other basic principle of this organizationWhich is exactly what it is - a basic principle! Hire pleasant, cheerful people, people of good disposition, and reject everyone who isn't.It isn't enough to be courteous to 74 patrons and pert with the 75th. It won't do to be cheerful 58 minutes of the hour and disgruntled the other two. It isn't sufficient for 10 employees to give service and the 11th to go slack on his job.In another hotel another clerk may have sold the guest just as comfortable a room, another bellman may have handled his bag just as deftly, another waiter may have served him piping hot dinner just as promptly, but the thing that made an impression on the guest was these latter employees seemed glad to do it, they seemed interested in him personally.Gracious service means more than "perfect" service. The guest will wait an extra minute for his chops if the waiter brings him a newspaper and explains the delay pleasantly.Every hotel employee is a salesman. He must satisfy customers with the only thing he has to sell - service - and he must please them with the way he sells it. I believe that a majority of the complaints in a hotel are due more to the guest's state of mind than to the importance of the thing about which he complains.E.M. Statler

Wendy's why do you want to be like Five Guys?you have everything you need to be #1. and that would be Dave's legacy please take time and rethink why was Wendy's so great to begin with. dont let human resources run the company they arent around after 5pm or weekends when you are doing 60% of your sales.

I hope they take a good look at who they are getting rid of, because I know of several that have worked at Wendy's in Wichita, Kansas that has been working for five years, or more, and still get the pay they started at. This is one thing they should look at real close. If you get low pay, why would you be upbeat to the customers/ Good pay brings good employees...

Setting your sites on making service and experience improvements on par with a company like Five Guys is like shooting for - your foot.

Wendy's leadership needs to look in the mirror. While I agree that it is an operations issue, store management hires the in-store employee and trains them. Here's a news flash, not ALL Wendy's operate poorly, neither does McDonald's, BK, KFC, or Five Guys, and, even if they do, I am sure the systems are in place for success, EXECUTION of those training and operational programs are the difference in success or failure. Good management at the store level dictates how a store performs, not a Board of Directors, CEO, or even a Training Department, use your "Five-Star" rating system for Area Managers and Store Management, not hourly employees, employee performance is a result of training, culture, and expectations set forth by store level management. This issue starts at the top, but, if stores are not executing at a store level, the basic day to day is not being done or followed up by Management.

Add new comment