Research Uncovers Operations Execution Hurdles For Restaurant Chains
Restaurant operators say improving employee productivity and compliance with operating procedures are top priorities for 2020
San Francisco – CA Zenput, a global leader in operations execution solutions, recently shared results of a survey of restaurant chain operators conducted in collaboration with Technomic. The research revealed new insights into the top barriers to consistent team execution and customer experiences facing both corporate brands and franchisee organizations, as well as where operators are prioritizing initiatives to improve operational execution in 2020. Key findings from the survey reveal:
The barriers to consistent store execution most frequently cited are rising labor costs (48 percent), employee turnover (44 percent) and insufficient training (39 percent)
Less than one in five restaurant operators say their stores are very effectively complying with operating procedures and key initiatives
Only one out of three operators report being very confident that they’re able to identify potential food safety concerns before they become an issue
The top cited priorities for the next 12 months are store employee productivity (48 percent), improving compliance with procedures (43 percent), field team productivity (42 percent), and improving store-level task completion (42 percent).
“The research findings underscore that restaurant operators are finding consistent execution increasingly difficult to achieve due to rising labor costs, high turnover, and the challenges associated with maintaining quality control across a geographically dispersed operation,” said Vladik Rikhter, Zenput’s CEO. “To remain competitive and grow, it’s imperative that brands and their franchisees focus on improving operations execution at every location, which if done well can be a key point of differentiation.”
The research study was based on a survey of 295 restaurant operators conducted by Technomic in the Fall of 2019. The pool of survey participants was comprised of operations leaders and managers, field leaders, store managers, IT leaders, C-suite execs, and owners.
Confidence in restaurant compliance with procedures and key initiatives lacking
Less than 20 percent of restaurant operators felt their stores were very effectively complying with operating procedures and key initiatives rolled out by the operations team at headquarters. Among full-service operations, this figure drops to 11 percent.
A core part of the compliance issue may stem from how operators report getting visibility into store execution today. Almost half of operators are still using traditional tactics like communicating via phone calls and text messages. Only 20 percent of operators indicated utilizing software to improve visibility.
Food safety is critical, but operators feel vulnerable
The ability to quickly identify issues and proactively address them before they become bigger problems is essential to long-term profitability. 88 percent of restaurant operators agree that a customer food safety issue could put their business at risk and would lead to a negative sales impact yet only 34 percent of respondents report they are very confident that their operation is able to identify potential food safety concerns before they become issues.
Audits leave much room for improvement and are a heavy drag on productivity
While audits are essential to ensure corporate brands and franchisees are delivering consistent experiences, only 22 percent feel they are being completed very effectively. Moreover, a lot of a field employee’s time is being consumed by the audit process. On average, field employees are spending over 30 combined hours of their week on in-store audits, preparing reports, and following up with stores to ensure corrective actions were taken. This leaves only limited time for training, coaching, new programs, and other organizational initiatives.
Use of automation suggests improved compliance and performance, yet adoption low
Just 27 percent of operators say they are embracing technology to automate various aspects of their organization “to a great extent.” That said, of those that are embracing automation at least somewhat, 83 percent say their experience has been positive.
For greater detail and insight into this research, download the full report. A deeper dive into the results will also be shared in a webinar hosted by Technomic on February 19th — click here for more information and to register.
Technomic Inc., a Winsight company, was founded as a management consulting firm in 1966. Since then, Technomic’s services have grown to encompass cloud-based B2B research tools, consumer and menu trend tracking, as well as other leading strategic research and analytic capabilities, to prioritize and size business opportunities. Our clients include food manufacturers and distributors, restaurants, retailers and multiple other business verticals aligned with the food industry that are looking to make informed decisions to support their business growth. Visit Technomic at www.technomic.com.
Zenput is how top operators elevate team execution in every store. Restaurant, retail, and other multi-unit operators such as Chipotle, Domino’s, and 7-Eleven use the platform to automate how operating procedures and key initiatives are rolled-out and enforced. Supporting 40,000 locations in over 35 countries, Zenput makes every field and store employee more productive and better equipped to do their jobs well.