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Improving same-store sales and customer traffic levels help drive the restaurant industry forward.
Deal valued at $374 million.
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From iPads to combi ovens to high-tech ice machines, there seems to be no shortage of technological innovations available to foodservice operators today. The challenge is sifting through all the promise the various forms of technology offer to find a solution that will enhance the customer experience and provide a positive return on the foodservice operation's investment.
While it may seem rather fundamental, good customer service remains one of the most important metrics by which any foodservice operation is evaluated. This applies equally to both commercial operations, such as chain restaurants, and non-commercial operations, such as hospitals, colleges or even prisons. No matter the location, service levels that fall short of customers' expectations will alter their perception of the food product, regardless of how good it is.
For that reason, foodservice operators from all segments of the industry are constantly in search of ways to enhance the customer experience, including service levels. Doing so can help guarantee repeat business from customers of commercial operations and higher satisfaction ratings among patrons of non-commercial operators.
As the front line of service, the foodservice operation's staff undoubtedly plays a critical role when it comes to service excellence. But it is equally important to understand that those foodservice professionals, no matter how well-trained and dedicated they may be, are only as good as the tools and procedures backing them up.
"Indeed, customer service has many aspects: service time, product quality, experience, courtesy, accuracy, etc.," says Juan Martinez, principal at Profitality, a Miami-based foodservice consultancy. "This is why we prefer to call it customer hospitality."
Improving Service Levels
Many foodservice operators proudly pronounce they have a culture of constant improvement. While such cultures are admirable and may serve the business well, when it comes to enhancing customer service it is not advisable to tinker with this area just for the sake of doing so. "Technology for the sake of technology is not going to buy you long-term growth unless it impacts an area of hospitality," Martinez says.
One area where the introduction of technology is having a positive impact on service is the use of ordering kiosks in some hospital foodservice operations. Staff can swipe their badges or a credit card at a kiosk, order the meal they want and select a time when they would like to pick it up. "That is certainly a very unique way of improving service through technology," says Bill Klein, president and CEO of DM&A (formerly Don Miller & Associates), an international healthcare foodservice consulting firm. "It gives the customer control and when they feel empowered it becomes a better experience."
Similar interactive technologies are making their way into the commercial segment, too. For example, some foodservice operators are using iPads to display a wine list or other menu items to help enhance the customer experience. While this may make the business appear trendy in the eyes of the customer, the operator needs to evaluate whether the time and expense associated with implementing such technologies can provide a desired return on investment over the long haul. "New technology does carry an appeal and it can drive visitation initially, but the technology better help create a better functional experience for your guest because eventually it will get old. If it helps you deliver on one of the benefits of customer hospitality then it will help drive return," Martinez says.
Other steps don't always catch the customers' eye, like applying radio-frequency identification (RFID) tags to food inventory to monitor its freshness, but can still have a profound effect on shaping the overall experience. "This will encourage the proper rotation of product without discouraging sales," Klein says.
Before taking any steps to enhance service, it is important to understand which areas are impeding the foodservice operation's ability to be successful. "You need to find out why customers are not coming to you more often," Martinez says. "Is it food quality? Service? And foodservice operators and their supply chain partners need to be on the street visiting the competition to see what they are doing better. You are always aiming to be as good as the best in whatever category you are competing in."
And operators would be wise to expand their horizons beyond their own competitive set. "Know where you want to go and set direction based on operations you want to emulate and not just what happens in your sector," Klein says. In the case of non-commercial operators, Klein suggests taking some time to walk their campuses, paying close attention to customer behavior and trying to identify other opportunities to better serve them. For example, in the case of a hospital, taking such steps might uncover an underserved part of the facility that would benefit from a coffee kiosk or some other type of limited service restaurant.
Another often untapped source of innovative ideas is the foodservice operation's front line personnel. They interact with the equipment and execute the procedures on a daily basis, which means they know the operation's strengths and weaknesses and customers' likes and dislikes rather intimately. "People all have ideas but the environment has to be conducive to sharing those ideas and implementing the ones that work," Klein says.
When evaluating the data it is important to be objective about it and not take anything too personally. "If you get too close to it, you can become too subjective and have your perspective clouded," Martinez says. "Be truthful to yourself. Otherwise you are just kidding yourself and you will make the wrong decisions."
For example, many foodservice operators may arbitrarily decide they want to enhance their speed of service. This might be a good idea for a quick-service restaurant but it might not be the best approach for a fine dining establishment, where the customers have very different expectations. "When it comes to speed of service, operators need to realize that speed can kill the experience and there is such a thing as going too fast," Martinez adds. "Seeking the right speed is critical both from a customer and a team member perspective. You can get a piece of equipment that cooks faster but you can hurt the overall process because the other pieces of equipment that contribute to making that menu item can't keep up."
Service issues that need attention should become clear after evaluating the customers' perspective on the foodservice operation and then comparing it to the competition. At this point, the foodservice operator should define the qualitative and quantitative aspects of the service issue being addressed. "Qualitative means the operator has identified the specific areas where the business would like to improve," Martinez says. "For example, you might know your speed of service needs to improve, particularly when compared to your competition." And once those areas are identified, the foodservice operator will define the metrics that will measure the levels of improvement.
In addition, it is important to understand the capabilities of staff and the available technology and then begin developing the plan, according to Klein.
These efforts may lead to a plan bigger than the foodservice operator can implement all at once. "Many companies phase in technology, and they have to for a variety of reasons," Martinez says.
When this happens, it is still important to look at the situation holistically. "Even if the operator can't afford to take every step, at least they now know the necessary steps and can start heading in that direction in a way that allows the operator to work within their constraints, be they financial, people, etc.," Martinez says.
One of the most critical and yet often overlooked components of improving service through technology is the impact new equipment can have on staff. The staff of the foodservice operation needs to work hand in hand with the existing technology and any new items introduced to help improve customer service. "We can buy employees a lot of fancy equipment but if they don't know why they are using these items it won't make a difference," Klein says.
Failure to understand that the technology and the people operating it are interdependent can lead to unintended consequences in other parts of the business. "There are many pieces that are linked in restaurant operations, and unless they are all considered holistically, the issue that the foodservice operation is trying to solve could be sub-optimized or even missed altogether," says Klein.
Choosing Technology: Out with the Old and in with the New?
When trying to improve customer service issues, it is only natural to think that a newer form of foodservice technology will be up to the task. Oftentimes, though, the solution may already be on hand in the form of existing equipment that just needs to be better leveraged. "The successful operators are looking at the equipment they have, combining it with locally sourced ingredients to create signature items and a concept," Klein says.
Martinez offers a similar perspective. "Look at what the operator is using and what the return is," Martinez says. He suggests looking at this from both a functional and an investment perspective. The functional perspective looks at what the employees are doing and the impact new technology will have on their roles. "And if you make it easier for them you know they will deliver," he adds.
In some instances, replacing an existing piece of equipment may be enough to satisfy the service objective. "For many operations, equipment is not as well maintained as we would like," Martinez says. "And when money gets tough the first thing operators tend to cut back on is maintenance." When this happens, introducing a newer piece of equipment can lead to service improvements.
Of course, the decision to update equipment may not be as clear cut. "Let's say the operation has an experienced but well-maintained grill. It may still be doing its job well but it is probably using more gas than more current models," Martinez says. "So you have to look at the cook times and determine if the newer models will allow you to cook items quicker. The faster cook times might help but in calculating that return on the new piece of equipment you have to look at the impact it will have on your line, exhaust, etc."
What to Look for in New Technology
Once it has been determined that an investment in technology will improve service, the operator needs to evaluate what features will benefit the business most. "It also depends on what you want to be when you grow up, meaning, where do you see your business headed and what do you want the equipment to do for you in the future that's not happening today?" Martinez says.
That's why flexibility is key when picking out a piece of equipment. "The more duties a piece of equipment can perform, the better for the foodservice operation," Martinez says. "This could save space, repair and maintenance labor, and utilities to name a few."
When selecting new technology it is equally important to have an idea of how much physical space it will require, the labor necessary to operate it and the procedures associated with using the equipment. "Collectively, these factors are critical in maximizing the impact to customer service," Martinez says. "If these factors are applied in the right balance they can have a phenomenal impact on customer service."
A few well-placed pieces of equipment in the front of the house can help shape the customer experience and perception of service, too. "Putting in wood-fired grills or rotisserie ovens can really set a hospital foodservice operation a part," Klein says. "Having a show station, where the chef uses an open flame or an induction burner, to create items made to order can really be impactful. You want to show that you are not doing things the same old way they have always been done."
Following this approach can do more than drive customer satisfaction — it can open the door to increase revenues. "In the old days, hospitals put out some deli meats and allowed customers to make their own sandwiches," Klein says. "Now hospitals have upgraded the bread and other ingredients and the items are made to order. As a result, people are willing to pay more and are happy because they have control."
It is also important to understand the impact the technology will have on specific menu items. "The caliber of the salad bar says a lot about an organization," Klein says. "Anyone can toss out some vegetables but you can take that extra step with the way you prepare some of these items."
"What is the end resulting quality?" Martinez asks. "Being able to prepare an item fast is generally good. But this should not happen at the expense of food quality. So adding a piece of equipment might work technically but if it will not stand up to the competition in a food quality perspective, its value to the concept is diminished. It has to work holistically."
The final obstacle to implementing new technologies that will improve service is getting buy-in from employees at all levels of the company. "Foodservice leadership has not been trained to be motivational or catalytic. They are trained to make meals every day," Klein says. "Doing anything different takes people out of their comfort zone because you will break their routines."
In order to change the culture and manage the change properly, very specific training will be necessary. "You have to reaffirm what you are doing and why you are doing it and how you are measuring your success," Klein says. "You can't just let people clock in and go to work. That is a major stumbling block to growing your business and improving your service."
Martinez agrees and adds, "Whatever technology you apply, it is more important to understand how it impacts the team members first because they can impact the guest more so than any form of technology. If it does something great for the customer but does not help the team members you can end up with an application that does not provide the proper return. In the long run, though, it is a balancing act. But if you ignore the team members you will never be able to execute a customer comes first mentality."
Social Networking for Campus Dining