Leadership

How Culture Affects Turnover and What You Can Do About It Now
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How Culture Affects Turnover and What You Can Do About It Now

by Lindsay Danis

The U.S. Bureau of Labor Statistics November 2021 "Employment Situation Summary" released in January of this year, confirms a dismal statistic of which you are more than likely aware: employees are walking away from foodservice and hospitality jobs in record numbers. In 2021, the quit rate in these industries jumped from 4.8% to 6.9%. The over-2% increase was the largest in any industry.

Your efforts to earn staff loyalty and build teamwork not only improve morale in the short term, they can reduce turnover and help you attract and keep skilled employees over the long haul.

To stem turnover, independent operators have tried hiring bonuses, referral bonuses, wage increases, and other financial incentives. These most certainly help; however, money alone is not going to solve your staffing problems.

In this market, if your team is not happy, they can likely find another employer who will match or exceed your wages. The so-called "Great Resignation" is not only about workers seeking livable wages. It is also about workers seeking quality of life.

Culture, teamwork and morale are "so intertwined together, when there is poor morale, you get very little done and the work you get done is substandard," says restaurant consultant Mark Moeller, owner of The Recipe of Success. Employee disinterest reverberates through the restaurant in different ways.

If you don't turn it around, it not only creates turnover, but poor performance among employees who stay. Employees who are unmotivated aren't working with the usual level of attention to detail. In a business that is won and lost in terms of pennies each day, this can be a disaster leading to waste, improper recipe adherence, and elevated food costs. Food that is sloppily made creates "a poor guest experience which leads to complaints which leads to lower top-line revenue," Moeller says.

When employees feel valued and part of a team, they have higher motivation, more cohesion, and a (more) positive attitude at work. While a higher wage is sometimes the right solution to cultivate value (for tips on how to tell when to offer more, keep reading), Moeller says there's more to the equation than cash.

Employees are "looking for employers who generally care about them, care about the work and the input they provide," he says, adding "they know the higher-ups are seeing them as a person and not a number."

Financial Security is Important, But We All Need More

You might have heard of American psychologist Abraham Maslow's "Hierarchy of Needs", which attempts to explain human behavior as working our way up a pyramid. The base of the pyramid reflects physiological needs, which are necessities for survival, like food and shelter. We can't even focus on achieving happiness without these. The next level up reflects safety and security, including financial security. A higher wage allows employees to meet their basic needs and improve their finances. More money makes a difference to employees who may have needed a second job to cover expenses. Let's consider this level for now.

"If your budget to hire is minimum wage, you're attracting the people that are at that level, which is a lower skill level. Take a hard look at increasing your budget" because "when you hire at $16-$17/hour [instead of $13] that person should be worth 1 ¼, maybe 1 ½ people," Moeller recommends.

In his experience, when operators pay people what they are worth based on skill set and experience, rather than from a framework of what the business can afford, they get better-qualified employees who provide more value to the operation. Moeller illustrates with an example. A client had been hiring kitchen staff in the $18-20/hour range, then bumped this up to $20-$22/hour. The raise in pay meant he could hire a solid prep cook who could also put together salads and sandwiches or hop on the grill. Because this prep cook could fill multiple roles, he was far more useful to the restaurant than the cook they'd have lured in for $18/hour. This type of hire benefits teamwork. New hires who can do more relieve pressure across the board, like if a cook calls out and the new guy can hop on the line.

Many business owners gripe that they can't get their employees to take initiative, but they don't train them to. Professionals have a sense of leadership about them. They're able to be a leader when necessary. But if we don't train them, how do we expect them to step up into that role?

For employees who have financial security, more money may be nice to have but it's not enough of an incentive to prevent them from looking elsewhere. Moeller brings up a client who hired a new cook at $20/hour. The cook told Moeller his previous employer wanted to hire him back and could pay $23/hour. The cook was happy at the new job and the hours were "perfect." He wasn't going to chase a higher wage because the new job met higher-level needs. When Moeller passed this information on to his client, she "on the spot bumped the guy to $22, not because she had to or was in fear of losing somebody, but because she was willing to see the value that person has and knows what it would take to try to replace that person in the kitchen."

The third level of Maslow's pyramid is the need for community and belonging. People long to feel connected to something greater than themselves. They want to be part of a group. After this tier comes esteem needs, which include praise, recognition and affirmation. People want to be valued and respected. They want to feel integral to the restaurant's success, not replaceable with the next warm body willing to work for your concept's starting rate.

You can reduce turnover and cultivate loyalty when you can help your staff fulfill needs for self-esteem and belonging. People want to feel proud of their contributions and respected for their judgment. Managers who berate and micromanage staff are dysfunctional and need to be replaced unless they can turn around their negative behavior.

How Culture Affects Turnover and What You Can Do About It Now

First, look in the mirror as the owner. Are you recognizing and appreciating the talent you do have? Are you setting up new hires to succeed with a comprehensive onboarding experience, training manuals, and resources? Are employees given some autonomy in carrying out their duties?

Micromanaging decreases morale. Trusting the people you hired to execute (perhaps at a higher level than you imagined possible) not only reinforces cohesion and loyalty (social needs), it meets employee needs for recognition for a job well done.

"When you hire somebody, you're hiring them to do a job," says Moeller. Allow them to do their job. Quite often, just because you have a system in place doesn't mean it's the best one. Be open-minded to the people doing the work because you might be amazed at a solution they have that you didn't know existed," he adds.

Onboarding Could Be Your Secret Sauce for Reducing Staff Turnover

"People need to feel connection, acceptance and friendship almost immediately," says Mel Kleiman, founder of Humetrics, a consulting business that helps employers hire, retain and engage primarily hourly employees. They want a manager or owner to appreciate them and care about them. If these needs aren't met, employees begin to disengage. They may start looking elsewhere. Satisfying social, belonging and esteem needs drives employee retention. For Kleiman, this starts during the onboarding process. New employees have five questions when walking into their first day on the job, Kleiman explains. "Will the boss like me? How hard is the work? Will I have friends? What are the rules? How will I be graded?"

The last question reflects employer expectations for the role. "If we can cover [these questions] in the first hour" and "if we can get them for the week, the odds are they'll stay," Kleiman says.

To Moeller, training and transparency are the keys to successfully onboarding new hires. Transparency starts in the interview process when managers are honest about the role and the work environment. If there was a negative employee who brought down the morale for everyone else and that person was just let go, there's no need to hide this in the interview. Likewise, if you're hiring because the concept is growing and the existing team is overworked, this extra information can benefit the new hire and set their expectations for the all-important first day.

Moeller recommends pairing employees with trainers who are certified or otherwise qualified for the role, and who have experience at the jobs for which they are helping staff learn. These individuals can take the new hire through the role "from beginning to end, answer all their questions and provide all the information they need to be successful." In addition, he recommends providing employees with manuals and other training materials where they can look up policies, recipes and other information without always having to ask a person. Transparency continues during training when a manager lets an employee know their phone number and email, so they can reach out with questions or concerns.

No one is perfect. You're not perfect and your managers are not perfect. Take time to search your soul for areas in which you might become a better owner, manager, and team member.

Kleiman encourages operators to keep "employee data sheets" on every new hire. These are sheets filled out by employees themselves as a get-to-know-you activity. Questions reflect home lives, hobbies, favorite foods, family and friends, and other interests. The sheet provides an easy way for managers and owners to learn about their employees and show an interest in their lives by asking about their hobbies and interests.

At a basic level, this might look like talking to an employee about their favorite sport or team. The value of this information is to give you insight into what motivates your team members. Kleiman gives an example of a time he rewarded an employee for a job well done with tickets to see a favorite band and a limo ride to the show. This cost $800, but it gave the employee a night she would never forget. She raved about the experience for the next six months, which offered a return on investment.

The approach to onboarding recommended by Moeller and Kleiman requires focus and strategy. It may mean taking a step back to prepare training materials or coach employees who have training duties. Kleiman encourages operators to keep a mindset that stemming turnover is a marathon, not a sprint.

Motivate your Existing Talent

While much of the current conversation about staff focuses on how to attract talented employees, don't neglect to take care of your existing workers. There are people who are inherently loyal and whose work ethic keeps makes them reliable. These are folks who are often taken for granted. And when they leave, they often take experience and knowledge with them.

How Culture Affects Turnover and What You Can Do About It Now

If they no longer feel appreciated, existing employees will begin to disengage from the work environment. They'll often bide their time, clocking in without working hard until they find a better opportunity. When existing employees begin to check out, Moeller says it's a sign they feel "unheard and undervalued." If an employee who has several years of experience with your business quits, it shakes up your newer employees.

Checking in with long-time employees, recognizing them for a job well done, and showing appreciation for their longevity goes a long way toward cultivating a work culture of belonging. When others see you appreciate loyal employees, it signals to them how they can expect to be treated in the long term.

By checking in with these employees, you might find out if they are dissatisfied and why. If an employee is dreaming of going elsewhere for a raise, it may be worth it to bump up their pay to keep them. "It's going to cost us more should we lose that individual," Moeller says. But as stated above, money isn't the only motivating factor. Nor should it be the first you consider.

In some cases, long-standing employees might feel like they are stagnating. When you provide growth opportunities for your employees, you give them more skills and new challenges to master. They are able to do more, which benefits your restaurant. For motivated and passionate employees, growth is inherently rewarding. If they are constantly learning something at your restaurant, they'll be more inclined to stay.

Growth opportunities can be customized. What is meaningful to one employee might be different for other employees, even those who work at the same job. Again, this is one of the advantages of getting to know your staff. People can get bored doing the same thing every day. Cross-training not only helps you when you are short-staffed, but provides an opportunity to make coming to work more interesting.

Says Moeller, beware the "clipboard manager". Great managers are hands-on. [They] know when to be supporting the team by cooking, bagging food, helping with prep – it's all about taking care of the guest."

News from the Front

Scott Alters is chef-owner of Rue Saint-Marc in Jacksonville, Florida, with his wife Gabrielle, who runs the restaurant's beverage program. Alters describes the restaurant as a neighborhood bistro "approaching the fine dining level" but with a warm and welcoming feel.

Rue Saint-Marc was able to keep most of its staff throughout the pandemic and hasn't experienced the issues with turnover and staffing impacting many other independent operators. Alters credits the restaurant's strong culture.

How Culture Affects Turnover and What You Can Do About It Now

Culture means two things to this pair of operators. First and foremost, Alters cites professionalism. Oftentimes, he says, restaurant operators "don't treat employees as professionals or hold them to the standards of professionalism on basic things like punctuality and appearance." He and his wife strive to treat employees with respect while upholding professional standards of behavior. Alters believes the focus on professionalism helps him get the right talent. Employees who don't want to work so hard are naturally driven away while those who are serious about their careers are excited at the growth opportunities this environment provides.

Thanks to technology, you can communicate positively with your staff without face-to-face meetings. Alters makes a habit of sending a video to his kitchen team every morning. Some videos are "skill-based things" like a sushi chef filleting a fish, some are "exposure themed" like a video from a Michelin-starred restaurant overseas, and the rest focus on leadership skills, which Alters prioritizes.

"Many business owners gripe that they can't get their employees to take initiative, but they don't train them to. Professionals have a sense of leadership about them. They're able to be a leader when necessary. But if we don't train them, how do we expect them to step up into that role?" Alters asks. Since the videos create talking points for the team to discuss, they reinforce teamwork while building skills.

Other initiatives Alters has adopted include a "huge education push" on the restaurant's wine and craft cocktail program. To keep a "constant flow of communication between our team and ourselves," the Alters will ask a server to pre- pare a 5-minute talk about a particular wine or spirit at line-up. "It creates a sense of community and they feel like they have an influence on their work environment," Alters says. The team feels like their opinions matter and understand through daily exposure that the owner-operators want them to learn and grow on the job.

"I think that's what keeps people wanting to work with us: they get to have an influence, they know they're going to be protected and cared for, they know they have to live up to the standards we set. But they are standards we've agreed upon" and explained; they're not arbitrary, he explains. The other aspect of culture Alters fosters is a sense of caring. "You need to create a culture in which people feel as though they are being cared for" and "can ask for help when necessary," whether it's with a personal issue or on the job, he says.

What's So Crazy 'Bout Peace, Love, and Understanding

We're all human beings. We're all trying to get by as best as we can. Be human and sincere in your interactions with staff. When a server indicated he was unhappy and talked about leaving, Alters sat down with him and asked him not to leave. Then he asked what the restaurant could do differently. "I sat there with a piece of paper and wrote down everything he said. Some of it was ranting and some of it was good points I had missed. The next day we [started] tackling everything on that list.

It made the restaurant better and the employee stayed. Owners or managers are so afraid to talk to someone who looks like they might be unhappy and that's the worst thing they can do," he says. The personal touch of listening and showing an employee their ideas are valuable prevented the server from quitting and ultimately made the restaurant stronger.

Alters doesn't think he and his wife are lucky to have a full staff when so many operators are struggling to hire. He believes it's the effect of nearly five years' development of a strong workplace culture.

No one is perfect. You're not perfect and your managers are not perfect. Take time to search your soul for areas in which you might become a better owner, manager and team member.

For independent operators who suspect that good employees might be thinking about leaving, Alters offers these words of advice: "Sometimes when you're in a position of authority, it's easy to assume you're not the problem and you may very well be the problem. Evaluate yourself. Write down what it is you would want to see from a great leader, then evaluate yourself against that." If you or your managers fall short, build skills to retain great people and hold onto new talent.

Next, he says, "ask yourself if you are running an environment that a great employee will want to be a part of." If you're not, great staff will leave.

When you understand what attracts employees to your work environment, you can strengthen that by making it a priority in the day-to-day, in much the same way that the Alters keep their staff learning and growing.