2017 employee management part 1...

EMPLOYEE MANAGEMENTHIRING THE BEST WORKERS & TRACKING LABOR

• PerfectingPizza.com

• Michael Shepherd Consulting, LLC

• World Pizza Champion to 3 Time US Pizza

Champion & 4 Time World Pizza Champion

• Judge, Jury, and Executioner

• Founder (former owner) Michael Angelo’s

Pizza & Six Hundred Downtown in Ohio

Michael Shepherd

• M.A. Applied Behavioral Science:

Organizational and Leadership Development

• Director of Development & Training

• Organizational Consultant & Team Building Coach

Ann Farrell

ESTB. 1995 8 locations

EMPLOYEE MANAGEMENTHIRING THE BEST WORKERS & TRACKING LABOR

EMPLOYEE MANAGEMENT PART 1:

HIRING THE BEST & TRACKING LABOR

•The cost of turnover

•hiring the best: Recruiting and

interviewing

•Building a healthy culture

•how to manage labor costs

•q&A: Ask us anything!

What do you

want to

walk away with

today?

GETTING GROUNDING IN WHY YOUR HERE

ORGANIZATION TAKE ON THE PERSONALITY OF LEADERSHIP

INDIVIDUAL WORK:

* IDENTIFY THE 3 BEST THINGS ABOUT WORKING AT YOUR PIZZERIA

* IDENTIFY THE 3 THINGS THAT GET IN THE WAY OF YOUR PIZZERIA BEING

THE BEST PLACE TO WORK IN YOUR TOWN

GROUPS OF 2-3: SHARE YOUR INSIGHTS FOR ADDITIONAL

INSIGHTS!

LARGE GROUP CONVERSATION: QUICK SUMMARIES

WHY START WITH TURNOVER

Change is Hard!!!Posting for jobs, looking at applications, checking references, interviewing, hiring, and training is the most challenging hard time consuming thing owners and managers do.

AND it’s some of the MOST IMPORTANT work you do!!

And MOST EXPENSIVE if you don’t do well!!!

THE HIGH COST OF TURNOVER

Real Life Story – Farrelli’s Good

News & Awful News

The Costs of Turnover• What is it? How do you figure it?

How to Decrease Turnover

REAL NUMBERS & REAL ACTION PLANBAD NEWS AND GOOD NEWS

Location Sales Turnover Cost % of Sales

Top Performing $1.9 Million31%

39 Team Members12 Separations 2016

$38,400 2% sales

• Beat Labor Goal for year!!• Highest Net Promoter Score• Highest percentage of Loyal

Guests

Worst Performing $1.5 Million105%


$131,2007.4% Sales

• Making a huge comeback!

Organization on the Whole

$16.5 Million68%


$790,0004.8% sales

• Goal for 2017 50% will contribute $224K to bottom line if our sales stay the same and they are already UP!


The WHAT Farrelli’s Industry Pre-Departure $100-$500 $176 3%

Recruiting $200 $1173 20%

Selection: Screening

Interviewing

$400 $645 11%

Orientation & Training $600-$800 $821 14%

Low Productivity -estimated

>50% of total turnover cost

$1300-$1500 $3049 52%

Average Cost $3000-$3400 $5864

Formula for figuring

Turnover Rate

The average number of employees per time measured divided by the number of separations.

70 W2s on December 31 2016- 39 W2s on January 1 2016= 31 Separations

31 ÷ 39 = 79% Turnover


80%

Current

Industry

Average

The rate at which

employees leave a

workforce and are

replaced.

Source: People Report, a division of TDN2k

HIGH COST OF KEEPING BAD EMPLOYEESOR NOT TRAINING GOOD ONES

• BAD SERVICE

• BAD FOOD

• FOOD SAFETY COMPROMISED

• DISORGANIZATION

Guests tell at least 10 people when they’ve had a terrible experience

• THEFT

• DRAMA

• GREAT PEOPLE LEAVE

• DECREASED SALES AND REVENUE

REAL NUMBERS & REAL ACTION PLANBAD NEWS AND GOOD NEWS

MONEY IS NOTEVERYTHING BUT IT

RANKS RIGHT UP THERE

WITH OXYGENZIG ZIGLAR

Core Value Guiding Principle

Growth We understand that business growth ispreceded by our own personal growth. We arecommitted to learning the skills necessary toboth manage and grow our business. Webelieve that the purpose of growth is to providenew opportunities for people.

We are profitable so we can grow

We embrace change and evolve to maintain relevance.

HIGH PROFIT OF HIRING THE BESTAND TRAINING FOR EXCELLENCE

• +100K TO THE BOTTOM LINE

• MANAGERS & TEAM MEMBERS ABLE TO FOCUS ON

GREAT FOOD AND GUEST SERVICE

• MORE FUN AND LESS DRAMA

• HAPPIER AND MORE LOYAL GUESTS

• GREAT WORD OF MOUTH MARKETING!

• INCREASED SALES AND CONTRIBUTIONS TO THE

BOTTOM LINE

ANY QUESTIONS ON

COSTS OF TURNOVER??

HIRING THE BESTRecruiting, Applications, Interviewing

THE SAD REALITY

• There are more “bad” prospects out there than good ones

• Without solid hiring practices you will find yourself on the defense more

than you are on the offense.

• The good news - implementing good recruiting and hiring practices is not as

hard as you might think!

A FEW HORROR STORIES

MEET “BOB”: BOB WAS PLANNING A BREAK IN

MORE OF “BOB:” BOB WAS PLANNING A BREAK IN

MEET “BETTY”: BETTY LIKED TO GO FAST

BE PROACTIVE NOT REACTIVE• You can never eliminate hiring bad employees

• But you can manage your risk and reduce the “bad” ones that you do hire

• Focus on hiring “outstanding” employees, not just reducing your exposure to bad

ones

RECRUITING THE BESTStep #1: Have a Great place to work!

• WOM Sells pizza and WOM sells your jobs

• Why in the world would anyone want to work for you?

• Would you want to work for you? Be honest?

• Today’s worker puts fun well above pay

• Are you allowing drama? Are you being fair? Consistent?

• Do you make it easy for your staff to do their jobs?

RECRUITING THE BESTStep #2: Sell the Position

• Be specific about what the job is.

• Explain the more interesting and challenging parts of the job.

• Be sure to point out any potential downsides that would cause someone not to be

interested, without scaring people away.

• Be upfront about what hours will be required of the employee. Be upfront about

the potential to make money.

• You don’t want to be flooded with people who can’t work the hours you need or

won’t make enough money to get by.

RECRUITING THE BEST

Step #2: Sell the Position (continued)

• Highlight the perks and positives of the job

• Make it sound like an awesome place to work

• Taylor the ad to fit the personality of the person you are looking for

RECRUITING THE BESTNow Hiring Pizza Masters!

We are looking for strong willed individuals who want to become a Pizza Master, learning the forgotten art of brick oven tending, pizza tossing, dough making and perhaps some acrobatic dough throwing. If you are a hardworking individual who loves a fast paced work environment, able to multi-task with ease, want bragging rights that you can do something that few others can do and enjoys a tough challenge, then this may just be the job for you.

Our pizza "apprentices" start at $8.00, but if you can prove to us that you have what it takes then you can quickly move up using our unique "self promotion" system that allows you to move up in pay as you master new skills. Additionally for full time positions we offer paid vacation, HRA health benefits, AFLAC insurance and a never ending adventure. However, this job is not for those who like to have their weekend nights free! Our busiest days are Friday, Saturday and Sunday evenings. So all candidates must have open availability to work whenever they are needed.

For more info and to download an application visit www.600downtown.com/employment.html or apply in person at Six Hundred Downtown - 108 S Main St. Bellefontaine, OH 43311

RECRUITING THE BESTStep #3: Advertise in the Right Places

• Newspaper?

• Craigslist?

• Social Media?

• Email?

• Box Toppers?

• Window sign?

• Always be hiring!

RECRUITING THE BESTStep #4: Hire Your Bests BFFs

Roman-> Nate -> Zach

Ericka-> Sarah -> Jewel -> Jacob

Tori -> Catherine

Landon-> Chris

Tiffany ->Charlene

BUILDING & USING AN EFFECTIVE

APPLICATION

MAKE YOUR

APPLICATION WORK

• An application will always contain the pertinent information that you need

to get someone started with a job, but you can also use it as a hiring tool.

• Let you application be your first “interview”.

• Screen out those that don’t fit the mold.

• Get creative!

• Watch for red flags.

MAKE YOUR

APPLICATION WORK

MAKE YOUR

APPLICATION WORK

• Consider a cover letter.

• Consider a math test.

• Have your front line staff make notes about the applicant. First impressions,

attitude, smell, car, arrival, departure.

• Make these notes on a “post-it”, not on the application.

RED FLAGS• Heavy smoke smell**

• Arriving with friends.

• Rude treatment of host/counter people.

• Dirty application.

• Be on the lookout for those who are

looking to just use you to fill in the

gap until they get a better job.

• Horizontal movers vs vertical movers.

• Periods of 1 year or less on the job.

• Leaving for personal reasons.

• Not returning after an injury or

illness.

• Bad remarks about previous employer

- no matter the circumstances.

INTERVIEWINGHow to Conduct an Effective Interview

INTERVIEWING

• You need a structured interview procedure and checklist.

• Put your questions, checklists and entire procedure on paper and commit to it.

• Enlist your managers and key staff to assist in interviews to get different

points of view.

• Build your process as a “Pass or Fail” system of elimination.

• Don’t allow managers to stray from the packet.

INTERVIEWING

Start with the Phone Screening Interview

The purpose of the Phone Screening interview is to save both you and the applicant time. There would be no point in bringing in someone for a face to face interview if they are unable to meet the minimum requirements for the job.

BASIC QUESTIONS

• Lift 50 lbs off of the floor and over

your head a number of times?

• Work 8 hours or more continuously on

your feet with no break?

• Work with your hands performing the

assembly of food?

• Work through lunch and dinner rushes

with a “lunch or dinner”?

• Work in a kitchen that gets over 85?

• Anything else we should know about?

DRIVER QUESTIONS

• Do you mind driving a company

vehicle?

• Do you have a reliable vehicle?

• Do you have a backup vehicle?

• Do you have insurance?

• Driving record?

• Have you had a DUI in the last 5

years?

• Any suspensions?

• Are you at least 18 and had your

license for 2 full years

EVERYONE QUESTIONS• What kind of hours are you looking for

or are used to?

• Tell me about your availability? Can you work until Xpm? Can you work every Friday and Saturday night?

• Are you involved in any hobbies or activities that we will need to work around?

• Why do you want to work here?

• Tell me when it is acceptable for someone to take something without paying for it?

• If the applicant knows one of your staff, ask them to explain how they know each other.

• Ask them about comments made from references.

PERSONAL REFERENCES• Keep it quick and to the point

• Don’t take references from relatives or friends

• Give them easy questions to answer

• Allow them time to open up and tell about the applicant in their own words

PERSONAL REFERENCES• How do you know the applicant?

• How long?

• On a scale of 1-10 rate them on

• Honesty

• Outgoingness

• Responsibility

• Do you think they would work well in the position of ___________?

• Would you allow this person to...

• A. Babysit your children?

• B. House-sit?

• C. Borrow your car for a week?

• Anything else you would like to tell me about the applicant?

DIGGING DIRT

• The references you get are only as

good as the references you get.

• Applicants will only give you good

references - usually.

• Social Media (while still legal)

• Google

• Ask your staff.

• Topix

• For drivers - MVR - (iix.com)

• Background checks for Managers and

key staff (iix.com & Secure Check)

• Drug testing (maybe)

FACE TO FACE INTERVIEW• Questions should be designed to strip away all of the learned

interviewing techniques.

• Questions are designed to have the applicant spend time talking.

Avoid one answer questions. Think essay questions.

• Force the applicant to open up and reveal true self.

• Your goal is to find out if this person is right for the job and if the

job is right for the person. Don’t set someone up to fail.

FACE TO FACE INTERVIEW• How much money do you need to make?

• What is the funniest thing that ever happened to you?

• Tell me about a disagreement with a co-worker?

FACE TO FACE INTERVIEW

• Remember not to ask the obviously illegal questions like - race,

religion, age, etc...

• But don’t forget to avoid the not so obvious potentially illegal

questions: Family, medical conditions, and pregnancy.

• Nervousness often is a sign that the person is serious and concerned

about getting the job and that is a good thing.

FACE TO FACE INTERVIEW

My favorite question to ask -

Tell me why we should hire you...and you are not allowed to tell me how hard

working you are, how committed you are, how you will be a “team player”, how you

love people, how you fast of a learner you are or any of those answers your school,

college, and textbooks have been teaching you. Tell me in your own real terms - why

should I hire you?

What is your favorite question to ask?

FACE TO FACE INTERVIEW• Remember not to ask the obviously illegal questions like - race,

religion, age, etc...

• But don’t forget to avoid the not so obvious potentially illegal

questions: Family, medical conditions, and pregnancy.

• Nervousness often is a sign that the person is serious and concerned

about getting the job and that is a good thing.

PEOPLE MATTER RESOURCE

• ENSURES YOU ARE COMPLIANT

• ALLOWS YOU TO CUSTOMIZE

QUESTIONS TO YOUR CULTURE

• PERSONALITY SCREENING – BRAND

STEWARDSHIP FOR MANAGERS AND

NON-MANAGER ROLES

• SCREENS FOR TAX REBATES

• GIVES YOU INTERVIEW QUESTIONS

BASESD ON PERSONALITY AND JOB

THEY APPLIED FOR

• PAPERLESS AND ALL ONLINE!!

APPLICATIONS

PEOPLE MATTER RESOURCE

• ENSURES YOU ARE

COMPLIANT

• I9 VERIFICATION

• VOLUNTARY OPTING IN FOR

EMPLOYER TAX CREDITS

• CAN UPLOAD ALL FORMS OF

ID - PAPERLESS AND ALL

ONLINE!!

ONBOARDING

TAX CREDIT QUALIFIERS

• VETERANS

• PEOPLE WHO HAVE BEEN

UNEMPLOYED FOR A WHILE

• PEOPLE WHO QUALIFY FOR FOOD

STAMPS AND OTHER WELFARE

BENEFITS

• PEOPLE WITH DISABILITIES

• PEOPLE ON PAROLE OR WHO

COMMITTED A FELONY

ANY QUESTIONS ON RECRUITING HIRING AND INTERVIEWING??

Great People Only

Need Apply

BREAK – 10 minutes

BECOME THE PLACE PEOPLE WANT TO WORKBuilding a High Performance

working culture

BUILDING A HEALTHY PRODUCTIVE

WORKING CULTURE

CULTURE: The shared values, beliefs, and behaviors that are

characteristic of a particular social group.

1. Have an Intentional Culture: Define the Values, Principles, and Mission that will drive the behavior so that your pizzeria meets and exceeds all expectations.

2. Hire only the very best people—good people.3. Create and provide effective business systems. 4. Set clear expectations and provide great training.5. Establish strong effective leadership.

The heart and soul of your pizzeria starts with your culture

THE WHY, THE WHAT FOR, AND THE HOW

THE WHY - PEOPLE

Creating vibrant working families

Taking care our families, neighborhood, and community

THE WHAT – PIZZA & OTHER DELECTABLES!

Incredible PIZZA and drinks

THE HOW – CULTURE & BUSINESS SYSTEMS

Healthy Working Culture: Discipline, Fun, Growth

Excellent Processes and Systems

BUILDING AN INTENTIONAL CULTURE

1. Suck it up.

2. Figure it out.

3. The only thing better than

Six Hundred is more Six Hundred.

4. We go to 11.

STRATEGIC INTENTION: HOW VALUES, PRINCIPLES, AND MISSION SHAPE YOUR BUSINESS.

•ACTS AS YOUR COMPASS: KEEPS YOU ON COURSE AND GUIDES YOU

TOWARDS THE STRATEGIES, TACTICS, AND DECISIONS THAT WILL

LEAD YOU TO SUCCESS!

• DEFINES YOUR CULTURE.

•GROUNDED WHEN TIMES ARE GREAT!

•KEEP YOU ANCHORED WHEN TIMES ARE HARD.

VALUES & GUIDING PRINCIPLESCore Values & Beliefs guide day-to-day-behavior.

• They are fixed, enduring, fundamental, and non-negotiable.

• They don’t change with time (including environment change).

• They are piercingly simply. They act as a guide for life.

• They capture what is authentically believed. They are the rules of life.

• They are bone deep and as natural as breathing.

• You know its ‘core’ even when it could become a disadvantage.

Guiding Principles are the IDEAS that strongly influence a

person/organization when making a decision or considering a matter.

VALUES & GUIDING PRINCIPLES EXERCISE

INDIVIDUAL WORK:

• Uncovering Core Values

GROUP WORK:

• What are the unconscious and conscious Values in your pizzeria that help or hinder your success?

• What are some ways you can make the these values “out loud” and capitalize on the positive and eliminate the negative impacts?

LARGE GROUP CONVERSATION:

• Debrief & Meaning Making

MISSION (PURPOSE) STATEMENT

WHAT SHOULD A MISSION STATEMENT BE?

A mission is an individual’s or organization’s fundamental reason for existence. Great organizations have a larger sense of purpose that transcends “being profitable;” They seek to contribute to the world in some unique way—to add a distinctive source of value.

-SENTIMENTS FROM PETER SENGE

“The organization of the future will be the embodiment of community based on shared purpose calling to the higher aspirations of people.

-DEE HOCK

MISSION/PURPOSE STATEMENT EXERCISE• INDIVIDUAL WORK: EXAMINING MISSION & PURPOSE

• LARGE GROUP CONVERSATION: DEBRIEF & MEANING

MAKING

VISION & GOALS EXERCISE

• INDIVIDUAL & TEAM WORK: DECIDE THE 5 MOST

IMPORTANT HIGH LEVERAGE THINGS YOU CAN DO TO

HAVE THE CREW OF YOUR DREAMS IN THE NEXT YEAR.

• LARGE GROUP CONVERSATION: MEANING MAKING

MANAGING LABOR COSTS

Understand prime and fixed costs

How to determine a labor budget

Writing a great schedule and proactively

phasing for business levels!

LABOR COSTSWhat should your labor cost be?

WHAT SHOULD MY LABOR BE?

They are ALL the CORRECT answer!

and they are all the WRONG answer!

10%

20%

30%

40%

LABOR COSTS

YOU CAN’T ESTABLISH YOUR LABOR

GOALS WITHOUT SEEING THE BIG PICTURE

a Complete Financial Modela Complete Financial Model

LABOR COSTS

PRIME COST EQUATION

• Food + Labor = Prime Costs…

• Different combinations based on concept…

• But should never go higher than 60% MAX!

32.8% Labor

is acceptable

in this model

But 32.8%

Labor is notacceptable in

this model

LABOR COSTS

LABOR COST IS…

RELATIVE TO YOUR FINANCIAL MODEL

LABOR COST IS NOT…

AN ARBITRARY NUMBER THAT FITS ALL

CIRCUMSTANCES

Actual Goal Bonus Over & Beyond Bonus Superb Bonus

Food Cost VR 0.008 0.01 0.0025 0.005 0.0035 0.0025 0.0045

Labor % 0.1923 0.20 0.0025 0.1950 0.0035 0.18 0.0045

OTD 22 20 0.00125 18 0.002 16 0.00275

Del Times 29 30 0.00125 28 0.002 26 0.00275

Oven Time 4 4 0.00125 3.5 0.002 3.25 0.00275

Avg Ticket 17.59 15 0.00125 16 0.002 17 0.00275

Cash Short -$14

Net Sales x Bonus % Bonus Cash Short Total Bonus

Bonus 70,000 0.01125 787.5 14 = 773.5

QUESTIONS & ANSWERS

What else do you want to know

about hiring, great culture, labor,

and managing people?

THANK YOU!!!

ANN FARRELLOwner & Director of Development

Farrelli’s Wood Fired Pizza

[email protected]

MICHAEL SHEPHERDJudge, Jury, and Executioner

PerfectingPizza.com

Michael Shepherd Consulting LLC

[email protected]

2017 employee management part 1...

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