Special Report | January 2017 | By Nicole Duncan

Focus Brands Blazes a Path for the Future

With new, tech-inspired digs, a collaborative mindset, and combined resources, Focus Brands is sprinting toward success.
The Focus Brands dream team (left to right): Sarah Powell, Gary Bales, Mike Dixon, Kat Cole, Nicolas Boudet, Steve DeSutter, Bob Swan, Paul Damico, and Michael Verdesca. Patrick Heagney

A cloud of words swirls above a row of rainbow-spectrum cushions. Posters of sweet tea, sandwiches, ice cream cones, and cinnamon rolls brighten the white walls. In the adjacent reception room, a digital screen bids visitors a tailored welcome with their names front and center.

But even this personalized touch can’t outshine five giant backlit letters on the opposite wall: FOCUS.

No, this isn’t the latest outpost of some tech giant like Google or Facebook. It’s the new digs for limited-service power player Focus Brands, whose portfolio includes Moe’s Southwest Grill, McAlister’s Deli, Schlotzsky’s, Auntie Anne’s Pretzels, Cinnabon, and Carvel.

Over the past couple of years, Focus has shed its vestigial systems and emerged as a leaner, meaner company. The most striking change—at least visually—is the newly minted campus. Just a stone’s throw from the old headquarters in Atlanta’s Perimeter Center, the three-floor building would fit nicely among the airy floor plans of Silicon Valley. From corner meeting areas with swing-set seats to a chalkboard wall decrying “Cheers for Peers” in the stairwell, everything about the campus screams trendy millennial habitat.

But the flashy office is only a reflection of deeper shifts in the company. Many of the changes were spearheaded by CEO Steve DeSutter, who has been with Focus just shy of three years. DeSutter may not be Mark Zuckerberg—DeSutter’s career spans more than three decades, with former leadership roles at Burger King and Stripes Convenience Stores—but he has the acumen to recognize the profound changes triggered by the younger generations.

“Technology and other factors are going to change things, and however we think about change today, it’s going to come faster and harder than we’ve ever experienced before,” DeSutter says. “For us to be a real winner, we were going to have to do certain things that were going to take our very solid brands … to the next level or position them to be able to win in this rapidly changing environment. And that was going to mean change.”

While DeSutter speaks with a leader’s confidence, he also has an affable demeanor that can quickly put an entire room at ease. That clear-eyed, patient presence is designed to inspire confidence in the team—especially since the plan involved tinkering with a system that was far from broken.

If it ain’t broke, break it and start fresh

If the Focus team was ever skeptical about changing the external and internal workings of their six brands, they don’t show it. Each concept had grown to scale and produced strong returns for franchisees, but as DeSutter points out, “the past does not predict the future.”

The Focus collection is composed of small and mid-sized brands. Three—Moe’s, McAlister’s, and Auntie Anne’s—made last year’s QSR 50. Still, none boast the girth of industry giants like McDonald’s, Chipotle, or the Yum! trio. And while all six are viable brands, they still have to play in the same sandbox as the big guys.

“How do we punch above our weight?” DeSutter asks, repeating a question he posed to his team when he joined in March 2014. “How do we take our scale and size of Focus Brands and put it to work for each of the individual brands, and yet preserve the integrity and the identity and the character of the brands?

“It was really obvious,” he adds. “These are not complicated questions. It was creating scalable, shared services.” In short, DeSutter knew that the whole would be greater than the sum of its parts. By combining departments across brands, Focus stood to improve its collective competitiveness—something that would trickle down from customer experience to brand value to franchisee success.

Industry rivalries were hardly the only, or even the biggest, force driving the revamp. Focus’s move might seem clairvoyant, but the winds of change had already blown through foodservice (and every other industry), disrupting communication not just in business-to-consumer interactions, but also at the human-to-human level.

“I don’t think you had to have a crystal ball two and a half years ago to see the obvious. Today we’re experiencing it in a more real way,” DeSutter says. “There’s a nimbleness that would be required, and that nimbleness is core to the operating model. It’s the part we work on every day now.”

At first glance, the campus might look like nothing more than millennial bait; chief human resources officer Bob Swan says with a laugh that he assembled a “cooler than Bob” team to help with those trendier elements. To achieve the nimbleness DeSutter spoke of, Focus had to foster a more collaborative atmosphere. DeSutter says people snickered when he told them the new space would be an “innovation campus” rather than a support center or company headquarters, but he emphasizes that the name is reflective of a larger corporate atmosphere.

“We’re going to call this an innovation campus, and we’re going to behave like that. We’re actually going to be more collegial,” DeSutter says. “There are a number of things we do on a regular basis here that are going to feel a lot more like a college campus than a corporate headquarters.”

Ramping up the “cool” factor

Before Focus moved in, the building was a gutted concrete space with a traditional office layout. While many of the walls were knocked down, concrete columns and exposed rafters remained in several areas, lending a slight grunge to an otherwise clean-cut appearance.

“We had nine months working with Gensler to bring the culture to life. We were moving fast,” Swan says.

In addition to design firm Gensler, Focus’s own vice president of development Steve Parker was also responsible for translating Focus’s new goals into a physical space. His influence was so great, in fact, that he is the only person to have a conference room (The Parker) named in his honor.

While more traditional in appearance, the conference rooms are not without their own bells and whistles. To sync their laptops with video monitors, employees need only type in an IP address for that particular screen. And like just about every part of the building—meeting rooms, printer rooms, individual offices, stairwells—the conference rooms have writable walls.

All three floors have several open-air rooms, each featuring bold colors and branding text. These “huddle rooms” are smaller than conference rooms and cannot be reserved. Sure, some of the design elements are superfluous—there are copper-clad chairs reminiscent of Moscow Mule mugs, globe pendant lights, and swing chairs (a compromise following an employee request for slides from floor to floor). But built-in dry-erase walls and video monitors that can sync with employee computers make the huddle rooms ideal spots for impromptu meetings—almost like a modernized student union at a big state university.

The second floor features cubbies where departments can display awards or just fun paraphernalia. One of the conference rooms sports a glass garage door, and in that space, the company hosts bimonthly “Garage Talks.” Similar to TED Talks, these 15-minute presentations differ widely in topic. Some are directly related to business, while others are about hobbies or more personal experiences. One recent talk, “Three Lessons from Running a Marathon,” offered advice that could be applied to work or life in general. DeSutter says the talks are announced one day in advance, and they’re usually standing-room-only.

Again, the “cool” factor of these impromptu presentations belies a much bigger purpose.

“It’s about intercepting our climate and breaking a pattern whenever we can with another idea,” DeSutter says. “That idea may or may not spark a new idea, but it’s much more what you’d expect within a collegial environment than you would in a corporate environment.”

He adds that Swan made sure to have stumps throughout the building for quick hallway announcements or updates. Swan jokes that they weren’t intended for stump speeches, but DeSutter keeps standing on them.

Focus on the fans

While increased collaboration has permeated all facets of Focus Brands, it has virtually catapulted digital media to a new level. On the ground floor, adjacent to the hall filled with brand buzzwords, is Focus’ social media listening center, also known as the Hub. This space displays real-time social media feeds across brands, making it a veritable command center for all things digital. Three wall monitors display activity across brands, social media platforms, and news outlets, as well as real-time analytics that are translated into visuals like word clouds and brand maps.

“I think every brand is taking a serious look at how to engage the consumer more. Being consumer-centric in everything we do is key to our long-term success—and that’s part of our overall strategy,” says Gary Bales, chief brand officer at Focus.

Of the C-suite team, Bales is the most tenured, having been with Carvel Holdings Company since 2002—two years before the company changed its name to Focus. Before that time, he was a franchisee. His roles at Focus have ranged from chief marketing officer to brand president to vice president to chief concept officer. Wearing so many hats has proved a key advantage now that branding/marketing strategy, public relations, social, and creative are working together more closely than ever before. The three social media managers (each overseeing two brands) will not only work with each other, but also interface with in-house PR and creative teams.

Other departments are now learning how to leverage the new consumer insight data mined by the social media team, Bales says. Working in tandem allows the brands to quickly pivot and evaluate what’s working and what’s not in real time.

In the early days of social media (less than a decade ago), many brands utilized the spaghetti approach: Throw something out there and see if it sticks. Strategies have become much more refined, and companies, including Focus, are taking social listening as seriously as they do tweets, Facebook posts, and more.

By pulling their resources—as well as budgets—all six brands now have tentacles reaching deep into the interwebs. Beyond the standard notifications triggered by a user mentioning the brand or using its hashtag, Focus can identify brand advocates, answer questions that aren’t directed to the brand handles, and home in on opportunities for engagement that might otherwise be overlooked. “Fans don’t expect us to be there, and then we engage them in a meaningful way,” says Paul Macaluso, president of McAlister’s and previously Focus’ senior vice president of brand marketing strategy.

One such example: In late October, Carvel’s Twitter account posted an animated GIF of mascot Fudgie the Whale, which actor and Twitter superstar Patton Oswalt tweeted about, saying it reminded him of The Shining. Social picked up on the opportunity and relayed the message to creative, which then made another GIF, this one of Fudgie walking through a cornfield a la Children of the Corn. Thanks to this digital exchange, Carvel saw a 187 percent increase in engagement, compared to the brand average in potential impressions.

The combined social media team can also pull together to drive special promos—or address any potential problems. For example, when Moe’s launched a new iteration of pork carnitas, one of the social media managers noticed an increase in negative conversations around words like “Moe’s” and “pork.” Customers found it to be overcooked or too strong in cinnamon flavor. Through this insight, the operations team was able to better educate operators about the proper cooking technique for the new item. Within two months, the negative sentiments had significantly decreased with phrases like “return the old pulled pork” being supplanted with “new, tender, crispy pork.”

No kitchen is an island

Around the corner from the Hub is the culinary innovation area, where chefs from five of the six brands (Auntie Anne’s being the exception, with its headquarters still in Lancaster, Pennsylvania) work in adjoining kitchens. Each is outfitted with equipment specific to the brand: Moe’s has extra fans for grilling, and Carvel’s space includes an ice cream display, just like those found in stores. Chefs are still tied to a specific brand, but everyone offers opinions and feedback to each other.

“There are no walls in between our kitchens; it’s free-flowing,” says Jason Dowd, executive chef for Moe’s. “The openness lets our chefs collaborate, have impromptu meetings, and bounce ideas off each other so all our brands win.”

This robust collaboration is seeding menu revamps across the board: Schlotzsky’s is upgrading its pastas (think Smoky Brisketeer Mac), Moe’s is offering LTO Smothered Burritos—including an option with a Hatch Green Chile sauce—and Auntie Anne’s is beefing up its snack options with Pepperoni Pretzel Bites. Dowd says that, thanks to social listening and consumer insights, the chefs can quickly gauge how well a new item is performing and whether they should make tweaks overall or specific to some markets.

The shared space also promotes collective bargaining for supplies and sourcing. Chef Jennifer Holwill, R&D director of Cinnabon, says that when outside vendors present a product, the chefs can consult with one another and decide if it’s an item that could be used in more than one brand.

Just as a combined social media team allows Focus to pay more for bigger or better products, the same holds true for R&D. Supply options that might have been cost prohibitive are now a possibility.

How Moore’s Law applies

When DeSutter came in with a vision for the future, he brought with him a new mantra and mission for the brands. Macaluso says the brand had always thought of itself as a “world-class franchisor,” but under DeSutter’s direction, the company has become a “world-class builder of brands.”

“A great brand builder is going to be a great franchisor,” DeSutter says.

Amid so many changes, some on the C-suite team worried that the franchisees would feel they were being forgotten or that the home office was being wasteful, spending huge amounts for seemingly superficial upgrades.

Bales says that in the past, whenever Focus added more brands to its portfolio, management’s pitch to franchisees always emphasized that being part of a bigger group opens doors to more opportunities. Nevertheless, he was more concerned this time. After all, Focus had gone from “fairly modest” offices to “sensational” offices.

“I kind of expected an, ‘Oh, this is where my royalties are going’—the normal kind of comments. [But] we have all our Franchisee Advisory Council meetings here now at least once a year, and to see the sense of pride that they walk away with, being part of this—it’s the total opposite reaction I would have expected,” Bales says. “They actually are so into getting to see the kitchen and the digital. … I think it’s helped us boost energy in literally every one of our brands.”

While the biggest changes have already been carried out, the Focus team knows this new agility will encourage them to keep moving at a faster pace than ever before. For DeSutter, the future can be illustrated by Moore’s Law, a theory predicting that the number of components on an integrated circuit will double every year.

DeSutter shares a fable to flesh out this abstract concept: After losing a chess game, the king of India was so impressed with his opponent that he offered to reward him. The man asked for one grain of rice on the first square, two on the second, and so forth, with the amount doubling through all 64 squares.

“The king said, ‘What a modest request,’ and then sent off his people to go fulfill the request, and they realized that there wasn’t enough grain and it would take decades to grow it—that’s Moore’s Law,” DeSutter says. “The challenge for us is that, yes, there will be change, but what you see today and the operating model today, we feel really good about. Will it need to morph and evolve? Absolutely. And I think that will be the way for any leadership team and in any business of the future.”

Comments

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