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Breaking the rules for better service
zY
Customer Service
Breaking the Rules for Better Service It's possible your company's customer-service policies are inhibiting the potential of your managers and costing you business. by Barbara Whitaker Shimko MANAGERS OFTEN FIND t h e m s e l v e s in special-case situations t h a t require t h e m to m a k e onthe-spot customer-service decisions. Yet the e s t a b l i s h m e n t s for which t h e y work, like m a n y establ i s h m e n t s in the food-service industry, often h a v e restrictive policies on decision m a k i n g t h a t
B a r b a r a Whitaker Shimko, Ph.D., is an associate professor of management and the director of the graduate program in humanresources management at Widener University, in Pennsylvania.
m a k e it difficult to provide high levels of c u s t o m e r service in the face of unpredictable situations. Such s t a n d a r d i z e d policies m a y no longer be appropriate, if t h e y ever were. Let's look at t h r e e real-life scenes to see how the "rules" can interfere with caring for guests' needs. Frank, an insurance executive struggling with his oversize luggage, comes huffing up to the registration desk at a downtown hotel. It's 1:00 AMand Sally is the night manager on duty. After securing a room, Frank wants a medium-rare steak, fries, and a beer sent to his room. The hotel's room-service policy states that "food service is available from 7:00 AMto midnight." While Sally
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knows that the kitchen is still open from the midnight buffet she also knows that the kitchen workers have been on their feet for at least eight hours. She ponders her options. Max, a truck driver who frequents the Maple Hill Diner, is in a time bind. Max needs to eat lunch and get back into his truck in 20 minutes if he is to complete all his stops in time. Although the diner has several "guaranteed quick" menu items, Max orders his favorite--the deluxe barbecue burger platter-which is not one of the six items guaranteed to be served in ten minutes. Max winks at Florence, his regular waitress, and says he knows © 1994, Cornell University
THE CORNELL H.R.A. Q U A R T E R L Y
he can count on her to take care of him. When Florence places the order, however, the cook says absolutely not, that order will not be ready in ten minutes. He's too busy pushing through the guaranteed orders. Florence hurries over to get Dan, the manager, to referee the situation. Dan wonders how far he should go to keep Max happy. Tom and Bobbie are enjoying their silver anniversary at a tropical resort in the Caribbean. The couple are relaxed and happy as they swim about in a lagoon. Their pleasure evaporates when Tom steps on a sea urchin. The pain is intense, and he is terrified that the creature might be poisonous. Limping toward the hotel in a state of panic, Tom tells Victor, who is managing the patio lunch, what has happened. Victor knows that, although initially quite painful, there are no long-term effects from a sea-urchin sting. Tom, frightened and still in pain, begins to hyperventilate. Bobbie is crying. Victor reviews his alternatives. Managers like Sally, Dan, and Victor continually find themselves in situations th at demand they make spur-of-the-moment decisions. But, as with m a n y other establishments throughout the hospitality industry, these managers' companies have policies t h a t prevent employees from providing the highest possible levels of customer service. This article takes a look at people who succeeded in climbing the m a n a g e m e n t ladder in the food-service industry.
Policy vs. Customer Service The exceptional situations in the preceding scenarios demonstrate t h a t company policies t h a t insist on standardization are no longer appropriate. In fact, hospitality managers should expect more guest exceptions and fewer "standard" guest experiences. Guest-service policies can no longer be applied without exceptions, because more and more guests have learned t h a t they can request exceptional t r e a t m e n t and, more often t h a n not, get it. Lodging and food-service managers must take care of such AUGUST 1994
special requests for two main reasons: (1) the proliferation of competitors in most markets, including competition from unexpected places (for example, grocery stores with in-store bakeries), and (2) the radical change in customers' demographics over the last two decades (for example, there has been an increase in two-income households, households of empty nesters, households whose occupants are over 65, and households of single people). N e w - a g e c o n s u m e r s . Families and households have diverse service needs t h a t are usually related to being pressed for time. These consumers are different from the "traditional" family groups of yesteryear, and it seems unlikely t h a t any single set of policies could cover their disparate needs. Business analysts have predicted t h a t the 1990s, even more so t h a n the 1980s, will belong to the customer, and as if to provide tangible evidence, books t h a t focus on customer service r e m a i n popular with publishers. The flow of service-quality books t h a t began in the 1980s continues into the 1990s. Interestingly, such books suggest a policy t h a t is not widespread in the food-service industry; t h a t is, to m e e t customers' exceptional needs regardless of company policy. Although mana g e m e n t is aware of the need to satisfy the customer, m a n y companies' policies do not encourage, or even allow for, the individualized or ext ra service t h a t m a y be needed to actually m eet customers' needs. The disparity between w hat is and w h a t might be is made even more acute by the ke e n competition in food service. It is therefore possible t h a t the companies t h a t are not focusing on customer service will be the companies t h a t will not m ake it in the fierce competition of the 1990s. It is projected t h a t 19
146,000 more m a n a g e r s will be needed to operate the food-service industry's organizations by the y e a r 2000 (and will involve a broad range of operations, from upscale full-service r e s t a u r a n t s to convenience stores, and from corporate dining to airline fare). 1 The people filling those positions and the latitude t h e y will have in m aki ng decisions can det e rm in e w h e t h e r service excellence will be a s t a n d a r d in the industry. As an example, I'll discuss the case of Pam, a contract food-service m a n a g e r with whom I had a personal interview. P a i n ' s s t o r y . P a m is a selfdirected and creative m anag e r who is not constrained by company policy. She does not need the approval of her boss to make h e r feel she has done a good job. Although the company she works for strives for standardization in everything from m enu to service delivery, Pam tries to individualize service for her clients. She actually caters to special requests. It is not unusual for her to disregard the standard m enu for a customer who has something else in mind. Of course, with the loss of standardization, P a m has to start from scratch in terms of pricing, ordering, and staffing. Pam is not, however, popular with her peers, m a n y of whom believe t h a t her focus on special service is too costly and not in the best interests of the company. Even her boss perceives P a m as a disruptive renegade much of the time, and so Pam has come close to being fired more t h a n once. How, then, has Pam survived? Because clients value her. When she gets into trouble, the clients demand t hat she remain to manage their accounts. Pam has discovered t hat she can charge higher prices (even though i S.J. Davis, "The 1 9 9 0 - 9 1 J o b O u t l o o k in Brief," Occupational Outlook Quarterly, Vol. 34, No. 1 (1990), pp. 8 - 4 8 .
that is not in accordance with company policy), because in today's market her customers are willing to pay extra for the service they need. While cost is a factor for every customer, there are some needs t h a t override cost considerations for the new demographic segments t h a t make up the largest share of Pain's customers.
Reordering Priorities Although the expectations of Frank, the harried insurance executive in the opening scenario; of Max, the late-running truck driver; and of Bobbie and Tom, the empty nesters, vary along a number of dimensions, one thing they have in common is their rethinking of priorities relating to the cost of their dining or lodging experience. While value continues to be a strong factor in consumers' decisions, many segments of the market are paying more attention to what they receive for their money rather t h a n just the cost of the experience. Businessmen and businesswomen, a large segment of the potential food-service market in the 1990s, want comfort and convenience. The families with two working parents, a group t h a t includes the families of 23 million children, need speed; they have some discretionary income to offset the sometimes high cost ofconvenience. 2Empty nesters (those parents whose children have grown up and moved out of the house), a still-growing group that made up nearly 40 percent of the adult population in 1988, want pampering. They have the opportunity to spend money away from home and have therefore become the primary sales and marketing target for the industry2 2 L y n n O ' R o u r k e H a y e s , ~Home-Delivered Chinese? Ho Lee Chow!," Restaurant Hospitality, Vol. 76, No. 12 (December 1992), p. 46. 3 M.M. K r a p p , "1990 N a t i o n a l R e s t a u r a n t Association Foodservice I n d u s t r y F o r e c a s t , " Restaurants U.S.A., Vol. 9, No. 11 (1989), pp. 2 1 - 3 0 .
While cost is a factor to all three groups, other needs are more critical. Cost will always be a factor in business, but as Pam (the atypical service-oriented manager) discovered, cost is not always the most important factor. Company policies that supported cost competition served the foodservice industry well in the past. Those policies advocated standardization as a means to control cost. Indeed, most food-service unit managers earned bonuses based on their ability to keep costs in line. The result was that customers received a standardized service; that is, they were all treated the same. But what happens when cost competition loses its primacy as the mechanism for success?
Food-Service Managers Findings from one group of foodservice managers in the Philadelphia area suggest that those with a conforming work style are most successful in their careers2 "Work style" was measured using activityvector analysis (AVA), a business tool meant to match the work style of individual employees with work styles needed in specific jobs2 It takes into account such attributes as people-orientation, decisionmaking style, desire for challenge and change, dominance, management technique, dependability, tolerance for ambiguity, conformity, and so on. AVA uses an adjective checklist t h a t takes about ten minutes to complete. It is simple for both the test taker and the administrator. ~ The AVA was administered to 105 "successful" food-service 4 J o y Dickerson, "A S t u d y to D e t e r m i n e If Successful Food M a n a g e r s H a v e a P r e d i c t a b l e W o r k s t y l e " (doctoral d i s s e r t a t i o n , W i d e n e r U n i v e r s i t y , 1990). ~Peter F. M e r e n d a a n d S.I. Berger, " F u r t h e r Evidence of t h e C o n s t r u c t V a l i d i t y of Activity Vector A n a l y s i s , " Journal of Clinical Psychology, Vol. 34 (1978), pp. 6 6 4 - 6 6 6 . 6 H.R. M u s i k e r a n d W a l t e r V. Clark, "Descriptive Reliability of Activity Vector A n a l y s i s , " Psychological Reports, Vol. 4 (1985), pp. 4 3 5 - 4 3 8 .
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managers working in limitedservice restaurants, health-care facilities, schools, corporate cafeterias, and country clubs. Success was defined as "being a manager for five y e a r s - - a n d two or more of those years with one company." Thus the respondents were the managers who were being retained and, the researchers inferred, were making it up the corporate ladder. Seventy percent of the managers in the study were characterized by a high degree of conforming behavior in their work styles. A notable characteristic of their work styles was a need to do right; t h a t is, to not step outside any guidelines. Clearly, such people take company policy seriously. It would be a rare day when they would intentionally deviate from it. Managers tend to hire people who are like themselves. 7Therefore the type of manager who reveres policy is most likely to hire people who also revere policy, and to groom them to take over new management openings in the years ahead.
Challenging the Entrenched In a classic example of paralysis through conformity, Robert Luke and his~onsultant group worked with a f~od-service chain where middle managers were extremely conforming2 The managers felt they would be fired if discovered deviating from company policy. Moreover, key executives felt that close, continuous supervision would maintain adherence to narrow policies by customercontact personnel and the store managers to whom they reported. Employees who conformed to company policy were rewarded and promoted. 7A.S. Baron, "Do M a n a g e r s Clone T h e m selves?," Personnel Administrator, M a r c h 1981, pp. 5 3 - 5 7 . 8R o b e r t A. Luke, P e t e r Block, a n d J a c k Duvey, "A S t r u c t u r a l A p p r o a c h to O r g a n i z a tional C h a n g e , " Journal of Applied Behavioral Science, Vol. 9, No. 5 (1983), pp. 6 1 1 - 6 3 5 .
THE CORNELL H.R.A. Q U A R T E R L Y
Luke's group was called in to address faltering sales, low sales per person-hour, and high labor costs relative to sales dollars. The consultants believed t h a t the problem was poor service resulting from the practices of close supervision and never, ever bending a company rule, which rules resulted from the influence of conformist managers who had already succeeded in the organization and now had additional authority. Luke and his colleagues took on the role of confronters, challengers, and exposers in a few districts of the widespread organization. They worked with different levels in the company to devise a slightly changed organizational structure for just the specified regions. For example, supervisors of store managers were moved out of the chain of command so that their role changed from being supervisory to being solely management-development (coaching). All authority for reward and promotion of store managers was taken out of their hands. The store managers experienced a number of changes in the quality of their work life as a result of the changed structure. Because they were closer to corporate operations, communication was more likely to reach them in a timely and clear fashion. Because they had no fear of reprisal from their new coaching managers, they could ask "dumb" questions and could decide not to take suggestions they thought incorrect. They consistently found in their coaching managers a sympathetic ear for their complaints. And perhaps most important, they were able to make more decisions on their own, decisions based on information about individual customers. Among the major changes exhibited by the unit managers was t h a t they began to make regular requests for help and information from higher-level persons. PreviA U G U S T 1994
ously the unit managers hid their ignorance because they feared reprisal. Another, more specific example is that these food-service managers became personally involved in managing the perishables required for their operations. In many instances the quality of perishable goods had been a major source of customer dissatisfaction, a fact that only the store managers k n e w - - a n d which they hid. Along with the organization's reorganization came the ability for managers to act on their knowledge of what weather conditions make for a bad or good time for lettuce, blueberries, or whatever, and decreased waste and increased sales in perishables were made possible. The bottom-line figures for stores in the structurally changed districts improved in all three operational areas for which the consultants had been brought in: overall sales, sales per person-hour, and labor cost as a percentage of sales. The freedom of the store managers to (1) abide by company policy or not; (2) make their own decisions regarding goods and services received by their customers; and (3) assume responsibility for budgets, expenses, and revenues apparently had a positive effect on the bottom line. As it turned out, during the early stages of using coaching managers, executives from corporate headquarters created an unsettling effect by frequenting their stores out of curiosity. The coaching managers stepped in, requesting t h a t the executives objectively watch the bottom-line figures rather t h a n subjectively watching the changes. Life a f t e r L u k e . It is notable t h a t the structural changes made in the Luke case were minimal. Stories are legion of the painful aftermath of organizational downsizing. The repercussions in the Luke case were much less painful, perhaps because the 21
changes did not include layoffs. The corporate executives were more curious t h a n pained. Few managers were directly affected, and therefore few needed to be trained to play different roles. While the coaching managers said they missed the control and prestige of traditional authority, they expressed pleasure at having gained interpersonal strengths. The Luke study lasted close to seven years, including some initial period for "selling" the idea to managers and getting started, and, later, for introducing the structural changes to other stores in the chain. Now, in the 1990s, the organization has moved on to just-in-time delivery and an emphasis on teamwork. Those concepts seem like a natural progression to many of the employees, who have kept up the momentum of Luke's earlier work. The coaching managers have handled most of the recent work on just-in-time delivery and teamwork a real tribute, it seems, to Luke and his colleagues.
Management Implications As the Luke case and the Philadelphia study demonstrate, foodservice managers who are succeeding in their organizations tend to be those who follow company policy to the letter. However, to retain customers in evolving and increasingly complex markets, it would seem that inflexible, standardized policies and conforming decision makers charged with meeting customers' unpredictable needs constitute a deadly duo. If the ability to provide quality customer service is a determinant of success in the 1990s, companies need to write policies favoring management decisions t h a t support individualized service, or else those companies need to hire managers who can exercise appropriate judgment despite inflexible policies. That is, they need managers who can decide when to waive policy.
Change policies or change managers? Companies will probably find it more feasible to change their policies t h a n to find m a n a g e r s willing to be risk-takers. A l t h o u g h t h e r e is a g r e a t deal of s t a n d a r d i z a t i o n in all b u t the most pricey establishments, food-service m a n a g e r s can be given the option of m a k i n g creative decisions w h e n the occasion d e m a n d s it. W h e n the c u s t o m e r h a s special needs t h a t justify the cost of satisfying those needs, the m a n a g e r can be allowed the flexibility to provide t h a t extra level of service as the c u s t o m e r defines i t - - h i g h quality, attentiveness, variety, attractiveness, or the availability of a special item, for example. C h a n g i n g m a n a g e r s would m e a n p r o m o t i n g those employees with different work styles from those now valued. A n d t h a t could be a difficult chain to unlink, because the executives in a position to promote such m a n a g e r s mostly value a n d s h a r e the characteristic of a conforming leadership style. Moreover, m a n a g e m e n t t r a i n i n g rarely changes the behavior of m a n a g e r s on staff, as a n y o n e who h a s tried it knows .9 This is especially true w h e n m a n a g e r s who h a v e completed t r a i n i n g p r o g r a m s move back into a static corporate culture after t h a t t r a i n i n g is completed. M a n a g e r s have a predomin a n t style t h a t t h e y a d h e r e to fairly consistently. P e r h a p s a more viable route to creative decision m a k i n g a n d the resulting good service would be hiring new m a n a g e r s with the desired style, m a n a g e r s who over the next several y e a r s would be coming up t h r o u g h the ranks. The 9See: D.D. Cram, "IfI Were King," Training, April 1992, pp. 55-61; Roger A. Golde, Muddling Through: The Art of Properly Unbusinesslike Management (New York: AMACOM, 1976), pp. 125-151; and George P. Huber and J. Clifton Williams, Human Behavior in Organizations (Cincinnati: SouthWestern Publishing Co., 1986), p. 382.
AVA or a similar i n s t r u m e n t could be used to identify applicants who m a y have the desired work styles.
Pressure to Conform R e s e a r c h h a s suggested t h a t in A m e r i c a n high schools only the s t u d e n t s who equate m a t u r i t y with acceptance of the s t a t u s quo have a chance to succeed, i° I f t h a t is true, the pressure to conform begins at a n early age. There m a y be a t e n d e n c y in every i n d u s t r y t o w a r d conformist decision making. Since the 1970s claims have been widely m a d e in the literature t h a t employees blindly loyal to the organization have been replaced by a new breed t h a t is creative, innovative, a n d r e a d y to challenge the s t a t u s quo.ll Such claims have been r e p e a t e d so often t h a t t h e y h a v e become c o m m o n wisdom; however, the evidence indicates t h a t t h e y are wrong. The p r e s s u r e to conform in the workplace seems to be as s t r o n g as ever, sometimes to the d e t r i m e n t of quality c u s t o m e r service.
Sally, Dan, and Victor In conclusion, here's how the three opening scenarios could t u r n out in organizations w h e r e m a n a g e r s have the latitude to bend the rules for customers with special needs. Sally, the hotel night manager, takes a good look at Frank, the hungry insurance executive. At this late hour, whatever food service Frank gets is up to Sally. Without talking to Frank about alternatives, Sally calls a chef in the kitchen with whom she has worked out customerservice plans on other occasions. He agrees to prepare the meal. When she hangs up the phone, Sally assures Frank that his meal will be delivered to his room within a few minutes, although there must be a $10.00 fee because of the late hour. She personally will see to the 10Edgar Z. Friedenberg, Coming of Age in America (New York: Vintage Books, 1965) p. 222. ~1Michael Maccoby, The Gamesman: The New Corporate Leaders (New York: Simon & Schuster, 1976), pp. 33-36.
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beer. Sally also takes the time to explain that the fee will cover the overtime expenses of the chefs, who already have been working since early this morning. Frank, a hard worker himself, understands. Mostly he is relieved to know that he will not have to go out for a meal. Under the circumstances, to him the fee seems a small price to pay. Dan is the manager at the Maple Hill Diner where Max was trying to get the diner's "guaranteed quick service" on a meal not included in the guarantee. Dan knows that customers often request changes from the regular menu--this request for a barbecue burger platter on the fast track is just one more example. Dan suggests to Florence, Max's favorite waitress, that she select two alternative side dishes to replace the more time-consuming side dishes that are ordinarily served with the barbecue. Max eats lunch at the diner often, so Florence knows he will like the biscuits and corn-on-the-cob, which are already cooked and ready to serve. When she serves Max in exactly ten minutes, she tells him about the substitution. Max is happy to have a delicious lunch and to be able to get back on the road on schedule. At the Caribbean resort where Tom has stepped on a sea urchin, Victor, the patio manager, is not worried about company policy. He is, however, worried about maintaining the patio lunch's smooth progress while still being able to help Tom. Victor recognizes that Tom and his wife, Bobbie, will want to talk to a manager for reassurance. Victor realizes this is a role he can play so he calls on his best waitress to manage the patio while he personally sees to Bobbie and Tom. Victor explains to the frightened couple that keeping offthe foot will make it worse and that Tom must do a moderate amount of walking in order for his system to mitigate the urchin's poison. Victor walks along with the couple for a while and listens again to Tom's story. Victor assures the couple that they should resume their vacation fun and that the effects of the sea urchin will disappear within 48 hours. Victor offers to call the doctor for Tom if he wishes to have his foot checked at the resort's medical facility, c o
THE CORNELL H.R.A. QUARTERLY
Customer Service
Breaking the Rules for Better Service It's possible your company's customer-service policies are inhibiting the potential of your managers and costing you business. by Barbara Whitaker Shimko MANAGERS OFTEN FIND t h e m s e l v e s in special-case situations t h a t require t h e m to m a k e onthe-spot customer-service decisions. Yet the e s t a b l i s h m e n t s for which t h e y work, like m a n y establ i s h m e n t s in the food-service industry, often h a v e restrictive policies on decision m a k i n g t h a t
B a r b a r a Whitaker Shimko, Ph.D., is an associate professor of management and the director of the graduate program in humanresources management at Widener University, in Pennsylvania.
m a k e it difficult to provide high levels of c u s t o m e r service in the face of unpredictable situations. Such s t a n d a r d i z e d policies m a y no longer be appropriate, if t h e y ever were. Let's look at t h r e e real-life scenes to see how the "rules" can interfere with caring for guests' needs. Frank, an insurance executive struggling with his oversize luggage, comes huffing up to the registration desk at a downtown hotel. It's 1:00 AMand Sally is the night manager on duty. After securing a room, Frank wants a medium-rare steak, fries, and a beer sent to his room. The hotel's room-service policy states that "food service is available from 7:00 AMto midnight." While Sally
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knows that the kitchen is still open from the midnight buffet she also knows that the kitchen workers have been on their feet for at least eight hours. She ponders her options. Max, a truck driver who frequents the Maple Hill Diner, is in a time bind. Max needs to eat lunch and get back into his truck in 20 minutes if he is to complete all his stops in time. Although the diner has several "guaranteed quick" menu items, Max orders his favorite--the deluxe barbecue burger platter-which is not one of the six items guaranteed to be served in ten minutes. Max winks at Florence, his regular waitress, and says he knows © 1994, Cornell University
THE CORNELL H.R.A. Q U A R T E R L Y
he can count on her to take care of him. When Florence places the order, however, the cook says absolutely not, that order will not be ready in ten minutes. He's too busy pushing through the guaranteed orders. Florence hurries over to get Dan, the manager, to referee the situation. Dan wonders how far he should go to keep Max happy. Tom and Bobbie are enjoying their silver anniversary at a tropical resort in the Caribbean. The couple are relaxed and happy as they swim about in a lagoon. Their pleasure evaporates when Tom steps on a sea urchin. The pain is intense, and he is terrified that the creature might be poisonous. Limping toward the hotel in a state of panic, Tom tells Victor, who is managing the patio lunch, what has happened. Victor knows that, although initially quite painful, there are no long-term effects from a sea-urchin sting. Tom, frightened and still in pain, begins to hyperventilate. Bobbie is crying. Victor reviews his alternatives. Managers like Sally, Dan, and Victor continually find themselves in situations th at demand they make spur-of-the-moment decisions. But, as with m a n y other establishments throughout the hospitality industry, these managers' companies have policies t h a t prevent employees from providing the highest possible levels of customer service. This article takes a look at people who succeeded in climbing the m a n a g e m e n t ladder in the food-service industry.
Policy vs. Customer Service The exceptional situations in the preceding scenarios demonstrate t h a t company policies t h a t insist on standardization are no longer appropriate. In fact, hospitality managers should expect more guest exceptions and fewer "standard" guest experiences. Guest-service policies can no longer be applied without exceptions, because more and more guests have learned t h a t they can request exceptional t r e a t m e n t and, more often t h a n not, get it. Lodging and food-service managers must take care of such AUGUST 1994
special requests for two main reasons: (1) the proliferation of competitors in most markets, including competition from unexpected places (for example, grocery stores with in-store bakeries), and (2) the radical change in customers' demographics over the last two decades (for example, there has been an increase in two-income households, households of empty nesters, households whose occupants are over 65, and households of single people). N e w - a g e c o n s u m e r s . Families and households have diverse service needs t h a t are usually related to being pressed for time. These consumers are different from the "traditional" family groups of yesteryear, and it seems unlikely t h a t any single set of policies could cover their disparate needs. Business analysts have predicted t h a t the 1990s, even more so t h a n the 1980s, will belong to the customer, and as if to provide tangible evidence, books t h a t focus on customer service r e m a i n popular with publishers. The flow of service-quality books t h a t began in the 1980s continues into the 1990s. Interestingly, such books suggest a policy t h a t is not widespread in the food-service industry; t h a t is, to m e e t customers' exceptional needs regardless of company policy. Although mana g e m e n t is aware of the need to satisfy the customer, m a n y companies' policies do not encourage, or even allow for, the individualized or ext ra service t h a t m a y be needed to actually m eet customers' needs. The disparity between w hat is and w h a t might be is made even more acute by the ke e n competition in food service. It is therefore possible t h a t the companies t h a t are not focusing on customer service will be the companies t h a t will not m ake it in the fierce competition of the 1990s. It is projected t h a t 19
146,000 more m a n a g e r s will be needed to operate the food-service industry's organizations by the y e a r 2000 (and will involve a broad range of operations, from upscale full-service r e s t a u r a n t s to convenience stores, and from corporate dining to airline fare). 1 The people filling those positions and the latitude t h e y will have in m aki ng decisions can det e rm in e w h e t h e r service excellence will be a s t a n d a r d in the industry. As an example, I'll discuss the case of Pam, a contract food-service m a n a g e r with whom I had a personal interview. P a i n ' s s t o r y . P a m is a selfdirected and creative m anag e r who is not constrained by company policy. She does not need the approval of her boss to make h e r feel she has done a good job. Although the company she works for strives for standardization in everything from m enu to service delivery, Pam tries to individualize service for her clients. She actually caters to special requests. It is not unusual for her to disregard the standard m enu for a customer who has something else in mind. Of course, with the loss of standardization, P a m has to start from scratch in terms of pricing, ordering, and staffing. Pam is not, however, popular with her peers, m a n y of whom believe t h a t her focus on special service is too costly and not in the best interests of the company. Even her boss perceives P a m as a disruptive renegade much of the time, and so Pam has come close to being fired more t h a n once. How, then, has Pam survived? Because clients value her. When she gets into trouble, the clients demand t hat she remain to manage their accounts. Pam has discovered t hat she can charge higher prices (even though i S.J. Davis, "The 1 9 9 0 - 9 1 J o b O u t l o o k in Brief," Occupational Outlook Quarterly, Vol. 34, No. 1 (1990), pp. 8 - 4 8 .
that is not in accordance with company policy), because in today's market her customers are willing to pay extra for the service they need. While cost is a factor for every customer, there are some needs t h a t override cost considerations for the new demographic segments t h a t make up the largest share of Pain's customers.
Reordering Priorities Although the expectations of Frank, the harried insurance executive in the opening scenario; of Max, the late-running truck driver; and of Bobbie and Tom, the empty nesters, vary along a number of dimensions, one thing they have in common is their rethinking of priorities relating to the cost of their dining or lodging experience. While value continues to be a strong factor in consumers' decisions, many segments of the market are paying more attention to what they receive for their money rather t h a n just the cost of the experience. Businessmen and businesswomen, a large segment of the potential food-service market in the 1990s, want comfort and convenience. The families with two working parents, a group t h a t includes the families of 23 million children, need speed; they have some discretionary income to offset the sometimes high cost ofconvenience. 2Empty nesters (those parents whose children have grown up and moved out of the house), a still-growing group that made up nearly 40 percent of the adult population in 1988, want pampering. They have the opportunity to spend money away from home and have therefore become the primary sales and marketing target for the industry2 2 L y n n O ' R o u r k e H a y e s , ~Home-Delivered Chinese? Ho Lee Chow!," Restaurant Hospitality, Vol. 76, No. 12 (December 1992), p. 46. 3 M.M. K r a p p , "1990 N a t i o n a l R e s t a u r a n t Association Foodservice I n d u s t r y F o r e c a s t , " Restaurants U.S.A., Vol. 9, No. 11 (1989), pp. 2 1 - 3 0 .
While cost is a factor to all three groups, other needs are more critical. Cost will always be a factor in business, but as Pam (the atypical service-oriented manager) discovered, cost is not always the most important factor. Company policies that supported cost competition served the foodservice industry well in the past. Those policies advocated standardization as a means to control cost. Indeed, most food-service unit managers earned bonuses based on their ability to keep costs in line. The result was that customers received a standardized service; that is, they were all treated the same. But what happens when cost competition loses its primacy as the mechanism for success?
Food-Service Managers Findings from one group of foodservice managers in the Philadelphia area suggest that those with a conforming work style are most successful in their careers2 "Work style" was measured using activityvector analysis (AVA), a business tool meant to match the work style of individual employees with work styles needed in specific jobs2 It takes into account such attributes as people-orientation, decisionmaking style, desire for challenge and change, dominance, management technique, dependability, tolerance for ambiguity, conformity, and so on. AVA uses an adjective checklist t h a t takes about ten minutes to complete. It is simple for both the test taker and the administrator. ~ The AVA was administered to 105 "successful" food-service 4 J o y Dickerson, "A S t u d y to D e t e r m i n e If Successful Food M a n a g e r s H a v e a P r e d i c t a b l e W o r k s t y l e " (doctoral d i s s e r t a t i o n , W i d e n e r U n i v e r s i t y , 1990). ~Peter F. M e r e n d a a n d S.I. Berger, " F u r t h e r Evidence of t h e C o n s t r u c t V a l i d i t y of Activity Vector A n a l y s i s , " Journal of Clinical Psychology, Vol. 34 (1978), pp. 6 6 4 - 6 6 6 . 6 H.R. M u s i k e r a n d W a l t e r V. Clark, "Descriptive Reliability of Activity Vector A n a l y s i s , " Psychological Reports, Vol. 4 (1985), pp. 4 3 5 - 4 3 8 .
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managers working in limitedservice restaurants, health-care facilities, schools, corporate cafeterias, and country clubs. Success was defined as "being a manager for five y e a r s - - a n d two or more of those years with one company." Thus the respondents were the managers who were being retained and, the researchers inferred, were making it up the corporate ladder. Seventy percent of the managers in the study were characterized by a high degree of conforming behavior in their work styles. A notable characteristic of their work styles was a need to do right; t h a t is, to not step outside any guidelines. Clearly, such people take company policy seriously. It would be a rare day when they would intentionally deviate from it. Managers tend to hire people who are like themselves. 7Therefore the type of manager who reveres policy is most likely to hire people who also revere policy, and to groom them to take over new management openings in the years ahead.
Challenging the Entrenched In a classic example of paralysis through conformity, Robert Luke and his~onsultant group worked with a f~od-service chain where middle managers were extremely conforming2 The managers felt they would be fired if discovered deviating from company policy. Moreover, key executives felt that close, continuous supervision would maintain adherence to narrow policies by customercontact personnel and the store managers to whom they reported. Employees who conformed to company policy were rewarded and promoted. 7A.S. Baron, "Do M a n a g e r s Clone T h e m selves?," Personnel Administrator, M a r c h 1981, pp. 5 3 - 5 7 . 8R o b e r t A. Luke, P e t e r Block, a n d J a c k Duvey, "A S t r u c t u r a l A p p r o a c h to O r g a n i z a tional C h a n g e , " Journal of Applied Behavioral Science, Vol. 9, No. 5 (1983), pp. 6 1 1 - 6 3 5 .
THE CORNELL H.R.A. Q U A R T E R L Y
Luke's group was called in to address faltering sales, low sales per person-hour, and high labor costs relative to sales dollars. The consultants believed t h a t the problem was poor service resulting from the practices of close supervision and never, ever bending a company rule, which rules resulted from the influence of conformist managers who had already succeeded in the organization and now had additional authority. Luke and his colleagues took on the role of confronters, challengers, and exposers in a few districts of the widespread organization. They worked with different levels in the company to devise a slightly changed organizational structure for just the specified regions. For example, supervisors of store managers were moved out of the chain of command so that their role changed from being supervisory to being solely management-development (coaching). All authority for reward and promotion of store managers was taken out of their hands. The store managers experienced a number of changes in the quality of their work life as a result of the changed structure. Because they were closer to corporate operations, communication was more likely to reach them in a timely and clear fashion. Because they had no fear of reprisal from their new coaching managers, they could ask "dumb" questions and could decide not to take suggestions they thought incorrect. They consistently found in their coaching managers a sympathetic ear for their complaints. And perhaps most important, they were able to make more decisions on their own, decisions based on information about individual customers. Among the major changes exhibited by the unit managers was t h a t they began to make regular requests for help and information from higher-level persons. PreviA U G U S T 1994
ously the unit managers hid their ignorance because they feared reprisal. Another, more specific example is that these food-service managers became personally involved in managing the perishables required for their operations. In many instances the quality of perishable goods had been a major source of customer dissatisfaction, a fact that only the store managers k n e w - - a n d which they hid. Along with the organization's reorganization came the ability for managers to act on their knowledge of what weather conditions make for a bad or good time for lettuce, blueberries, or whatever, and decreased waste and increased sales in perishables were made possible. The bottom-line figures for stores in the structurally changed districts improved in all three operational areas for which the consultants had been brought in: overall sales, sales per person-hour, and labor cost as a percentage of sales. The freedom of the store managers to (1) abide by company policy or not; (2) make their own decisions regarding goods and services received by their customers; and (3) assume responsibility for budgets, expenses, and revenues apparently had a positive effect on the bottom line. As it turned out, during the early stages of using coaching managers, executives from corporate headquarters created an unsettling effect by frequenting their stores out of curiosity. The coaching managers stepped in, requesting t h a t the executives objectively watch the bottom-line figures rather t h a n subjectively watching the changes. Life a f t e r L u k e . It is notable t h a t the structural changes made in the Luke case were minimal. Stories are legion of the painful aftermath of organizational downsizing. The repercussions in the Luke case were much less painful, perhaps because the 21
changes did not include layoffs. The corporate executives were more curious t h a n pained. Few managers were directly affected, and therefore few needed to be trained to play different roles. While the coaching managers said they missed the control and prestige of traditional authority, they expressed pleasure at having gained interpersonal strengths. The Luke study lasted close to seven years, including some initial period for "selling" the idea to managers and getting started, and, later, for introducing the structural changes to other stores in the chain. Now, in the 1990s, the organization has moved on to just-in-time delivery and an emphasis on teamwork. Those concepts seem like a natural progression to many of the employees, who have kept up the momentum of Luke's earlier work. The coaching managers have handled most of the recent work on just-in-time delivery and teamwork a real tribute, it seems, to Luke and his colleagues.
Management Implications As the Luke case and the Philadelphia study demonstrate, foodservice managers who are succeeding in their organizations tend to be those who follow company policy to the letter. However, to retain customers in evolving and increasingly complex markets, it would seem that inflexible, standardized policies and conforming decision makers charged with meeting customers' unpredictable needs constitute a deadly duo. If the ability to provide quality customer service is a determinant of success in the 1990s, companies need to write policies favoring management decisions t h a t support individualized service, or else those companies need to hire managers who can exercise appropriate judgment despite inflexible policies. That is, they need managers who can decide when to waive policy.
Change policies or change managers? Companies will probably find it more feasible to change their policies t h a n to find m a n a g e r s willing to be risk-takers. A l t h o u g h t h e r e is a g r e a t deal of s t a n d a r d i z a t i o n in all b u t the most pricey establishments, food-service m a n a g e r s can be given the option of m a k i n g creative decisions w h e n the occasion d e m a n d s it. W h e n the c u s t o m e r h a s special needs t h a t justify the cost of satisfying those needs, the m a n a g e r can be allowed the flexibility to provide t h a t extra level of service as the c u s t o m e r defines i t - - h i g h quality, attentiveness, variety, attractiveness, or the availability of a special item, for example. C h a n g i n g m a n a g e r s would m e a n p r o m o t i n g those employees with different work styles from those now valued. A n d t h a t could be a difficult chain to unlink, because the executives in a position to promote such m a n a g e r s mostly value a n d s h a r e the characteristic of a conforming leadership style. Moreover, m a n a g e m e n t t r a i n i n g rarely changes the behavior of m a n a g e r s on staff, as a n y o n e who h a s tried it knows .9 This is especially true w h e n m a n a g e r s who h a v e completed t r a i n i n g p r o g r a m s move back into a static corporate culture after t h a t t r a i n i n g is completed. M a n a g e r s have a predomin a n t style t h a t t h e y a d h e r e to fairly consistently. P e r h a p s a more viable route to creative decision m a k i n g a n d the resulting good service would be hiring new m a n a g e r s with the desired style, m a n a g e r s who over the next several y e a r s would be coming up t h r o u g h the ranks. The 9See: D.D. Cram, "IfI Were King," Training, April 1992, pp. 55-61; Roger A. Golde, Muddling Through: The Art of Properly Unbusinesslike Management (New York: AMACOM, 1976), pp. 125-151; and George P. Huber and J. Clifton Williams, Human Behavior in Organizations (Cincinnati: SouthWestern Publishing Co., 1986), p. 382.
AVA or a similar i n s t r u m e n t could be used to identify applicants who m a y have the desired work styles.
Pressure to Conform R e s e a r c h h a s suggested t h a t in A m e r i c a n high schools only the s t u d e n t s who equate m a t u r i t y with acceptance of the s t a t u s quo have a chance to succeed, i° I f t h a t is true, the pressure to conform begins at a n early age. There m a y be a t e n d e n c y in every i n d u s t r y t o w a r d conformist decision making. Since the 1970s claims have been widely m a d e in the literature t h a t employees blindly loyal to the organization have been replaced by a new breed t h a t is creative, innovative, a n d r e a d y to challenge the s t a t u s quo.ll Such claims have been r e p e a t e d so often t h a t t h e y h a v e become c o m m o n wisdom; however, the evidence indicates t h a t t h e y are wrong. The p r e s s u r e to conform in the workplace seems to be as s t r o n g as ever, sometimes to the d e t r i m e n t of quality c u s t o m e r service.
Sally, Dan, and Victor In conclusion, here's how the three opening scenarios could t u r n out in organizations w h e r e m a n a g e r s have the latitude to bend the rules for customers with special needs. Sally, the hotel night manager, takes a good look at Frank, the hungry insurance executive. At this late hour, whatever food service Frank gets is up to Sally. Without talking to Frank about alternatives, Sally calls a chef in the kitchen with whom she has worked out customerservice plans on other occasions. He agrees to prepare the meal. When she hangs up the phone, Sally assures Frank that his meal will be delivered to his room within a few minutes, although there must be a $10.00 fee because of the late hour. She personally will see to the 10Edgar Z. Friedenberg, Coming of Age in America (New York: Vintage Books, 1965) p. 222. ~1Michael Maccoby, The Gamesman: The New Corporate Leaders (New York: Simon & Schuster, 1976), pp. 33-36.
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beer. Sally also takes the time to explain that the fee will cover the overtime expenses of the chefs, who already have been working since early this morning. Frank, a hard worker himself, understands. Mostly he is relieved to know that he will not have to go out for a meal. Under the circumstances, to him the fee seems a small price to pay. Dan is the manager at the Maple Hill Diner where Max was trying to get the diner's "guaranteed quick service" on a meal not included in the guarantee. Dan knows that customers often request changes from the regular menu--this request for a barbecue burger platter on the fast track is just one more example. Dan suggests to Florence, Max's favorite waitress, that she select two alternative side dishes to replace the more time-consuming side dishes that are ordinarily served with the barbecue. Max eats lunch at the diner often, so Florence knows he will like the biscuits and corn-on-the-cob, which are already cooked and ready to serve. When she serves Max in exactly ten minutes, she tells him about the substitution. Max is happy to have a delicious lunch and to be able to get back on the road on schedule. At the Caribbean resort where Tom has stepped on a sea urchin, Victor, the patio manager, is not worried about company policy. He is, however, worried about maintaining the patio lunch's smooth progress while still being able to help Tom. Victor recognizes that Tom and his wife, Bobbie, will want to talk to a manager for reassurance. Victor realizes this is a role he can play so he calls on his best waitress to manage the patio while he personally sees to Bobbie and Tom. Victor explains to the frightened couple that keeping offthe foot will make it worse and that Tom must do a moderate amount of walking in order for his system to mitigate the urchin's poison. Victor walks along with the couple for a while and listens again to Tom's story. Victor assures the couple that they should resume their vacation fun and that the effects of the sea urchin will disappear within 48 hours. Victor offers to call the doctor for Tom if he wishes to have his foot checked at the resort's medical facility, c o
THE CORNELL H.R.A. QUARTERLY