Planned failure

You have heard of the saying "If you fail to plan, you plan to fail". This is true in any business and just as disastrous in the restaurant business. Let's examine how and why this happens.

Why did this happen to me? I followed all the right advices.

In most cases restaurant operators or owners are high in spirits as they start building their restaurant, and for good reason. It's like conceiving a baby and you're full of hopes and dreams. Nothing seems to go wrong and everything's looks rosy and promising. Then your friends and relatives come along and join the chorus of cheering you on. You believe that everything you have thought of is right and is validated by the nod of approval of the people around you. This makes you not want to hear all other inputs that contradict yours, because it's a good feeling to hear 'words of approval'. In other words, you base your decisions mostly on an emotional base from people close to you who may not necessarily be your customers.


How can this happen to me? Everything's seemed right from the start.

There are many way that a new restaurant owner can be in this situation. Listen to some of their 'defining statements'

"let's start with the cheapest and simplest, we will just grow when the business succeeds - doing it right, then first time"

Even when they are capable of spending the investment, some still opt to start with cheapest, the simplest, the smallest, the most basic modules or configurations for their restaurant. They believe that they are starting a small business anyway. They are right, and they will probably stay that way - small. I call this LVM - Low Volume Mentality.

A mindset of being small creates an excuse not to spend big. It's a vicious cycle. Notnonly is it a self-fulfilling prophecy, for practical purposes, this mindset limits your planning to a low level of business. Less tables, less chairs, less plates, glasses and tablewares. "We will just buy more when the customers increase". Guess what sir, customers won't wait for you to get him the spoon while his soup gets cold. He will simply go to the next restaurant the next time. No second first impression, right?

"it's only a small thing, no one will notice, they will understand"

News flash: THEY WON'T UNDERSTAND. Customers have become brutal in their opinion. Worse they have become vocal and demanding. Worse still, they won't just whisper the bad experience to their friends, they post on on Facebook and Twitter - with photos and address of your restaurant.

Attention to details means ensuring all aspects of the customer experience is aligned with your restaurant's concept and theme. If your a Japanese resto, don't just post any reproduction artworks in your restroom. Everything must come together.


"I am the owner and I have always wanted this on my restaurant"

Being the owner may give you the prerogative to create you restaurant the way you want it, just because. ("wala lang, gusto ko lang"). With this prerogative come great risk. Following your whims and caprices can be dangerous as it limits the range of creative pool to start your business. Too much of yourself leaves no room for other ideas, comments and practical advices. This mindset also usually ignores the needs and wants of customers. So Mr. Owner, you should accept that it's NOT your restaurant. It's your customers.

Next week: Planning for Failure 2

Why Resto's Fail

We are easily amused when a new restaurant opens and is easily packed by hungry and happy customers. We ask with envy, how'd they do that? As customers, we offer reasons for its success from our own point of view - as customer. But what really made that restaurant click may still be a marvel to even the owners themselves. (they just try NOT to act surprised)

What is even more intriguing is how to explain why restos fail. Often, it's easier to offer reasons why even the most attractive, well-built and advance-designed restos don't make it even from the get go. Everyone becomes an expert in nit-picking a bad resto. Maybe they are experts - as customers.

Let me attempt to explain why restaurants fail. From the insiders point of view - the operator.

Next: Planned failure...

Transitions, Learning and Change Management

There were several insights that made an impression on my personal and professional perspective. Some of them reflect what I already believe in and still managed to hit a nerve that allowed me to revisit my own journey.

Foundations of true leadership

The long debate for the essence and origins of leadership had taken center stage in many business books and publications. No matter what the conclusions were, not one article will fail to discuss the central characters background and personality. For indeed the core of one’s character and being defines how the leader will become.

Are leaders made or born? History suggests that leaders who have defined history itself did not just come out late in life to develop what have made them great. All the great ones have been carefully honed and trained early in life by a significant figure that have influenced their upbringing. Childhood training, experience and environment are the most significant part of the person’s formative years. Andrea Jung’s story tells us how a simple piano lesson gave the future CEO the discipline to complete the job and that the last eight minutes of the program is just as important if not more important than the first 52. That is perseverance. That built Andrea’s strong resolve to initiate, execute and deliver results for what is now one of the most profitable company’s in the world.

My humble beginnings made a big impact and contribution to my work habits. It is to my parents’ credit that I have acknowledged and learned hard work early on in my life. The values of honesty, integrity and perseverance are stronger so it seems when your family does not have more. The consequence of poverty should be perseverance not hard ships. The simple household chores that we abhor as a youth, are the important ‘on-the-job’ training that we will meet later in life. I missed the chance to thank my parents for those training hours. Now I won’t miss a chance to give the same training to my own kids.

Grafting of two different cultures

The lessons learned form the BI & D merger give us a picture of typical M&A stories. Like a new stem that is being grafted into an old trunk, both parts will try to squeeze as much nutrients from the trunk and from each other in order to survive. In the end the most dominant ‘specimen’ will survive and take on the role of dominating the whole tree. In some sad cases, the less dominant part could not take the ‘grafting’ easily and falls off the trunk before the grafting fully heals. This paints a picture of how people will resist any form of domination from a presumably co-equal species. And this is when a strong leader is needed to prescribe the right environment, the appropriate conditions and terms of the grafting period. It is in this period that both parties must clearly see who is in charge and is able to define the common ground to be shared by all stakeholders. Without a strong leader committed to bridging the differences between two different and seemingly dominant cultures, the in fighting will not stop until and unless, a stronger and more defined culture is defined and articulated by the leader.

I recall how my previous company folded into the bigger listed company that acquired us. Both management teams present a posture of dominance and superiority. Both thinking they are better than the other. As a natural consequence, less work can be done on account of varied discussion over how things can be done. Sooner than later the more dominant of the ‘species’ prevailed being the acquiring ‘species’. The leader was quick to preside and define ‘how things must be done’. Consequently, a big part of the new species’ character, form and substance was also grafted into the acquiring species. After all, there would not have been a merger if the acquiring company did not see any good character, form and substance in the new company.

As months and years progressed, it was apparent that the grafting or healing period was not complete. Many employees who rejected the system ‘fell off the trunk’ and went their way. As those that fell off constitute just a minor part of the trunk, no apparent effect can be detected. More months passed and when a ‘major trunk’ decided to fall off the tree, the significant effect was already negated by the ‘already-healed’ grafted part. Three is already one whole being.

Journey and destination of leadership

When does one’s journey start and when will it end? The module thought us or emphasized the need to return to the origin before you begin to see the destination.

And the origin dates back to one’s childhood. The early environment of family, friends, neighborhood, school, community and work defines clearly where the journey started. Each of these segments contributes to the development of one’s character, values and principles that will make up his leadership style. They are the building blocks or DNA that defines how the leader will face challenges, stresses, moments of truth and defining moments.

While the origin is important, the journey is just as important. It is where the leader further hones his talent, experience and perhaps re-defines his values that will shape his future. This is the time when school, training and the work environment play a big part. How one reacts to this segment in his development is already defined by how well his origin had made an impact on him. Needless to say, a solid foundation of good moral values, ethics and work habits will resonate in the person’s reactions to his environment.

The destination therefore is pretty much defined by the leader’s journey. Both are important as both define each other.

As I review this paper, I can’t help but revisit my own origin, my current journey and what I see as my destination. Its more clear now that the way I raise my children will define how well or bad they will define their own journey and destination. As parents, we have a serious responsibility in defining their origins. We can only do so much to influence their origin. But in the end, it is their own responsibility to define and reach their destination. Come to think therefore, we are in effect responsible for their destiny.

The same can be said with our employees. All employees are presumed to have clean intentions for the company. It is the leaders role to define those intentions and provide an environment that will translate the intentions into fruitful and productive actions.

And as the company defines and continues to re-define its destiny, the role of the leader becomes more vivid and permeated through the whole organization’s character. Employees can only perform to a point where they are lead. The leader therefore cannot afford to stand still, because he will block the road to success by doing so.

Germin G. Espino

EMBA-ECI

Asian Institute of Management

Makati City, Philippines

Reflection Paper on Transitions, Learning and Change Management, May 3, 2010

Prof. Milagros Du Lagrosa, Phd

The Impact of Leadership: P 2,000-Career

Coming from an average income family, hard work was not new to me. We were not well off but we were not hard up either. My upbringing through public school gave me tough life lessons that I still bring to the work place up to now. It was a good first part of my life.

On my senior years I eagerly joined the country’s number one fast food chain on its infancy. Going to work every day just brings excitement and fun and believe it or not, I do look forward to the next work-day after a day off. The pay did not matter although it did give me some satisfaction and a sense of fulfillment. I can’t remember the days I called in sick and very seldom did I become tardy. I guess my managers liked me and was an instant favorite when extra hours are needed. Work was fun, I had to ask my managers to transfer me to other stations. Cleaning the restrooms, brushing floors, cleaning the glass panels, bussing tables serving food, flipping burgers, frying chicken joys, scooping ice creams, yes I’ve done them all.

This attitude and work habit made work easy and enjoyable. On one occasion I helped do some artwork for the office. The manager liked it and was happy that I was doing it on my day off. She asked me to help out in marketing – kiddie parties, marketing programs, sales-building stuff. What an opportunity.   

That started my fast-growth. That was when I looked at the future differently. So I set my eyes on doing more – to be a manager at 20 (I was 19 then). And that happened as planned. Hence forth, I gave myself deadlines on the next managerial level. I got them all a year ahead. Success was nice.

Along the way, life lessons pile up. From being a good soldier, I became in charge of a team of soldiers myself. It was a big step and I struggled to take on the new role of a leader. It turns out I had good foundation in my early years as a manager. But like any normal rookie manager, there I did my share of mistakes. When you’re a young manager who used to be a service crew, you tend to do a lot crew work yourself and you get yourself tied up with crew work and forget about managing. Old habits die hard. Another common flaw is to be familiar with your staff  who used to be your co-workers. Co-equal employees who now have to take orders from you. It was an early test of one’s fairness and credibility.

I learned early on that leaders need to define his leadership style and adapt to certain unique conditions. And that the uniqueness of conditions will only present itself at a point when you need to react instantaneously.  So by the time you have figured out what style of leadership is needed, the condition may have alredy changed.

Years went by and after many hurdles and fortunately advancement in career, the lesson learned still present similar patterns and characteristics. There is not one style that will fit all conditions. In other words, leadership style and application must evolve if it is to be effective.

After a colorful 10-year stint at Jollibee Foods Corporation, I joined a foreign pizza brand as Franchise Operations Manager. I figured that joining a smaller company will give me a chance of being a ‘head of the rat’ instead of a ‘tail of the cat’.

The company Domino’s Pizza Philippines belong to a conglomerate who is primarily in the logistics, ship management and cargo forwarding business. It is in this very diverse company that will turn out to be the biggest and most significant ‘business school’ that I ever attended. My career grew under my mentor – the COO of the company.

Little did I now that I joined Domino’s Pizza Phillippines at a time that it was going south. As Franchise Operations Manager, I had the opportunity to join board meetings and important company events. It turns out that I was being ‘watched’ by the COO – Atty Arthur P. Tugade or APT as he is fondly called. On one fateful week when the future of my company was being decided on my top management, I was called by the APT in his office. It was bonus time and our company being in the red for along time was not eligible for any incentive. He offered his hand upon meeting me and was surprised to feel a few folded bills being handed to me. He asked me to continue to get involved in the company and to ‘hang in there’. His remark was both re-assuring and scary.

Outside of his office, I later knew that he just handed me P 2,000 that’s supposed to represent my ‘bonus’. At that time, that amount represented less than 5% of what other managers might have received. But to me, it was worth much more. The ‘bonus’ meant an assurance that this boss will take care of me if I only hung on.

And hang on I did. Staying on in the company proved to be an intelligent decision, that gave me even more opportunities and boosted my career. After several months, my mentor named me General Manager of the company. On hindsight, the P 2,000-bonus really bought me a career that is now worth so much more than its monetary value.

Discipline, hard work, perseverance and good spirit, are some of the values I learned from the man who mentored me during our company’s troubled times. These are the same sets values that resonate from me and manifests in the leadership style I have learned to develop over the years.

My mentor was always the consummate people person, able to treat any type of employee of client with genuine concern and respect. He can be the stern negotiator in front of a client one day and the jovial and even frolicking manager drinking with company truck drivers the next day. In both cases, one will see him with the same set of values that he espouses - day in, day out.

I am now a COO myself and have been blessed to enjoy a good life. Of all the leaders I have been under, it was my mentor who has presented a good balance of appropriate leadership style and a firm and consistent display adherence to values.

I am confident that the same values will take me to future career advancements. But I am also sure that I need to learn to continuously evolve my leadership style and learn how to adapt to the changing conditions.

It has been more than 12 years since that fateful meeting with my COO and mentor. The impact still remains. Now I look forward to retiring early from the rigors of employment and lead a quiet life. I know I will enjoy retirement because along the way to success, I had been a fair and honest leader who have made the same impact as my COO made on me. And I can imagine that someday, a few other successful leaders will write the same story about me.

Germin G. Espino

EMBA-ECI

Asian Institute of Management

Makati City, Philippines

August 18, 2010