Promoting from within – Lessons from the Restaurant Business
When you read about a labour shortage it’s a concern but when the shortage is your company’s, it’s a crisis. Demographic trends are making an already tight labour market even more critical. Data that shows fewer hospitality students are choosing restaurants as their career, highlight the challenge. Way down deep under the numbers portending labour shortages and declining interest in the restaurant industry, is a solution: Keep and grow the talent you have!
Identifying and promoting leaders from within has to be a cornerstone of any effective talent strategy aimed at ensuring a company is fully staffed with trained management and hourly employees. The benefits of promoting from within are clear, including:
Reduced recruiting, hiring, and training costs– Internal candidates have insider knowledge of the skills required of the people they are going to manage. In many instances, the 4-6 weeks most companies would invest in positional training can be skipped
Enhanced understanding of company culture – A friend of mine says it like this: “You can’t build old cultures with new faces.” Where it might take a year for a newbie to understand the nuances of the business, the internal hire knows his or her way around the organization as well as what is important
Enhanced performance and retention – There is ample evidence from a variety of industries that managers promoted from within have a significantly better chance of both performing well and staying
Enhanced employee motivation to stay – All great companies have stories that are told of hourly employees who have moved up through the ranks to the C-suite
Go Slow to Go Fast
Like it is with hiring, internal sourcing can create its own problems if done poorly. The basics of an effective internal process, include:
Build in an interim step (or steps) between the hourly position and full time management. This gives the candidate a feeling for supervision before committing 100% and the training has begun. Many companies, for example, create a job called “key employee” that enables an hourly employee to learn the ropes of supervision while being supervised.
Put internal candidates through the same rigour as an external candidate. That’s because of the fact that what made them a successful hourly may be quite different than what will make them a successful manager. Test for what is different! The assessment you use to identify leadership capabilities is important. Testing reduces the guess-work of making a good decision and just might prevent you from losing a good employee who fails after promotion. Have someone from outside their business interview them. This step is as much about making sure you are making the right decision as it is about ensuring the candidate knows this is a big step.
Invest early. Expose the potential manager to one of your company’s training programs or send them to an outside resource. The right individual wants to grow, learn and be challenged. If you can provide them with a sample of that early your odds of getting them interested improve. Jody Palubiski, CEO of the Charcoal Group, believes that their High Potential Leadership Program is one of the reasons his team members join the management ranks and stay with the company.
The future is bright. Provide internal candidates with a visual of the steps on their way to the top including all of the developmental support you will offer along the way. Freshii, an international franchise organization has developed their Growth Map that illustrates the path from an hourly restaurant role to Franchise Ownership. Ashley Dalziel, Chief People Officer at Freshii says “the growth map is a part of the opening package at our new restaurants, we want to make sure that people know from day one that they have opportunities with our company”.
Pick the right location to kick off a new manager’s career. If possible, let the new manager land in a different restaurant or department from where they trained. It can be difficult managing your friends, especially when it is your first management job.
Celebrate the promotion. Your culture will dictate the way you recognize this significant commitment. If possible, include top management and their peers in the celebration. When an employee sees one of their own getting a promotion it sparks their interest and, if done properly, will create a perpetual cycle of internal promotions.
Measure Success. In spite of the fact that the number one concern in Hospitality is the labour shortage, it is surprising how few organizations track the key metrics. In addition to turnover statistics, companies can also measure a) # of internal promotes/year; and b) Retention of Internal promotes vs. External hires. Dean Sockett, VP of Human Resources for Keg Restaurants says “the data that we collect on Management Turnover is clear – Internal promotes are significantly more likely to succeed than individuals hired from outside.”
This last point brings me back to my friend’s insight about the challenge of protecting and growing a strong culture with outside hires. After all, one of any CEOs chief responsibilities is to ensure that his or her company has a strong and healthy culture.