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Morning Briefing Strap Line
Fri 9th Mar 2018 - Friday Opinion
Subjects: Creating a compelling corporate narrative, the taste-makers redrawing the food and drink landscape, the architecture of choice and the challenge of technology integration
Authors: James Hacon, Glynn Davis, Paul Chase and Alastair Scott

Creating a compelling corporate narrative by James Hacon

With such negativity circulating in the mainstream media about our sector, it’s important to remember it creates a feeling of uncertainty about our sector that can and is being digested by the general public and, perhaps most worryingly, your own front-line team. It’s at times like this that communication is vital. 

A well-known documentary producer and good friend of mine constantly reminds me of the importance of story as a medium. His theory is as humans we use story to make sense of the world. If we are not given a clear narrative and information, by nature we will continually construct a story from what we see around us to try to make sense of the world. 

Speaking to industry colleagues earlier this week at Propel’s Multi Club Conference, it seems there are two lines of thought here. The first is perhaps an old school methodology of keeping information among a very tight circle of people in senior roles. One leader told me this method is still preferred by his board but in engaging with his front-line team what he finds is a constant upfront line of questioning about the business, its performance and where it’s going, heightened, he says, during uncertain times. His belief was this was the new generation, who were highly curious and perhaps much more direct in their approach. Given we know millennials want to make a difference in their lives and want meaning, understanding the broader business environment will be paramount to their motivation and engagement. 

The approach that I think bears more fruit is to have an open dialogue of conversation with the team. Talk to them directly – don’t rely on cascading. That means investing in visiting sites and doing whole team meetings, but more importantly for more regular interaction, the obvious opportunity is to use technology. The options are endless, from tools such as Facebook for Business to your own company apps, which many of our training and back-of-house solution providers now offer. A more traditional method that many still use to great effect is the employee magazine, although this is potentially at a greater cost and has its challenges in terms of getting information over when time-sensitive.

The key factor at play with internal communication is engagement. That comes down to the effectiveness of your messaging and whether your team are actively consuming it. 

The first and most fundamental factor to engagement is whether your message is actually reaching your team and whether they are consuming it. It’s a lot of work to produce the content and investment in distribution, whichever way that may be. While poor content will put your team off engaging for a second time, there is no guarantee good content will mean they will engage at all. Some brands I’ve seen gain traction here use elements of competition and giveaways to do this – as well as giving the team the opportunity to contribute directly. I’m currently finishing a project of this kind, where we have turned to gamification to drive engagement within the team app, which will in turn ensure log-ins and greatly increase the likely exposure of news on the same platform.

Now tackle your messaging. To me this comes down to much of the same sentiment I expressed in my article last month about thriving or surviving. It’s about building a strategy and vision that works for today’s challenging market. It needs to deliver a powerful positive narrative that inspires. Most commonly this will be done through interesting initiatives rather than through the excitement of new site growth, which may have been the case over the past few years. Be careful not to cut the elements of your business that make it fun and engaging for your team – it may be a short-term win for cash flow but it is very likely to be long-term failure for your employee engagement and, in turn, your service levels and productivity. I’ve said it before and I’ll say it again, in a tough market you will have to do more to take less.

Once you’ve devised a strategy that inspires, then its time to make sure you deliver team members content they want. When getting going this is easier to judge by seeing what content performs in terms of readership, likes and comments. To get started it’s worth sitting with the teams and asking them what they are interested in.

The last key question to ask yourself is who should be responsible for such messaging. I believe it’s important to get contributors and messages coming right from the top of your business. You may want to build in-site and area level content too. That said someone has to take care of the project day to day. Traditionally this has been shoehorned into an HR or people team. To me it makes most sense to use your social media team who are far more experienced in creating and sharing content that aims to build engagement, as well as interact at all times of day. In a way it is just another channel for them to manage, often with much the same messaging.
James Hacon is managing director of Think Hospitality, which advises multi-site brands on growth, brand and development strategy, as well as investing in early stage concepts with a bright future

The taste-makers redrawing the food and drink landscape by Glynn Davis

Prezzo, Chimichanga, Jamie’s Italian, Square Pie, and Byron are among the growing number of restaurant brands that are either ceasing trading or the shutters are being pulled down on many of their outlets. This is proof if it were needed this is an increasingly tough environment for foodservice businesses to operate and nobody in their right mind would be on the expansion trail at this point in the cycle.
 
But along with the can’t-put-a-foot-wrong wizards at JKS (Gymkhana, Trishna, Hoppers etc), there are a number of other people very aggressively growing their businesses – within the food halls category. For every restaurant brand that ceases trading it feels as if it is being replaced by a new food hall. This phenomenon is predominantly concentrated in London but not exclusively, as it is spreading to other major conurbations around the country.
 
There are two ways to look at this – it either represents a complete changing of the guard in restaurant-land that hints at what the future of the eating out industry will look like; or we are seeing the creation of white elephants that will ultimately succumb when the hubris around street-style food goes out of fashion.
 
What marks the movement out is the credibility of its supporters. Some of the most intelligent and charismatic individuals in the industry are pinning themselves to the category. They are massively passionate and have proven the model for their large food hall/market concepts in various locations.
 
At the head of the pack has been Jonathan Downey, co-founder of Street Feast – that operates Dinerama, Lewisham’s Model Market and has just received planning permission to open an indoor food market in Woolwich. Alongside him is Roger Wade, who initially created the Boxpark container concept to showcase unique fashion brands but that has since morphed into a food hall business successfully operating in two locations. It has also just received planning permission for a new food market near Wembley Stadium.
 
Also in the mix is Simon Anderson, an original backer of barbecue pioneer Pitt Cue Co, who is opening three market halls in London including a massive 37,000 square foot premises in the former BHS building in Oxford Street – apparently it will be the largest food hall in the UK. Between them these three markets will house 50 bars and eateries. Another operator in this field is Incipio, which recently opened Feast Bar & Kitchen – a sizeable 300-seater venue in White City – having made its name with the nearby Pergola on the Roof.
 
What is most interesting – and potentially alarming – about these markets are their sheer scale. It is because of this we can be sure property companies love them. They take up serious square footage at a time when retail and foodservice businesses are vacating premises. And they are frequently in locations that are in desperate need of a prod in order to get some form of gentrification going.
 
In keeping with the hip relaxed vibe these venues look to create, the fit-outs are equally laid back (AKA makeshift), which helps keep costs down of course, but it also sits well with the transient nature of the food offerings that constantly evolve. The core customer base of these food halls demands a different food and drink proposition on each visit. In the case of the Woolwich market, the whole concept is temporary because it is effectively a two-year pop-up that will run until the site is redeveloped.
 
The temptation to move into an “on-the-up” area to take over a disused/empty building and fill it with small food operators and bars is very real for operators and their conspirators, the desperate landlords. But there is a warning from Wade that delivering just a food and drink offer – regardless of how cool the foods providers are – is simply not good enough.
 
Hence he is adding music and entertainment to his Croydon site and this element will also be integral to his Wembley development. The same thinking is coming from Downey, who has highlighted that Woolwich will include a pool hall, trampolines, and other activities. 
 
Such food hall offerings are absolutely not for everybody – just as fine dining isn’t – but the taste-makers like Downey, Wade and Anderson among others are certainly redrawing the food and drink landscape. Their actions will increasingly filter down into the mainstream and have a marked effect on all parts of the industry for some years to come.
Glynn Davis is a leading commentator on retail trends 
 

The architecture of choice by Paul Chase

Old ideas are sometimes relaunched by employing a new language to disguise or mystify what they’re about. And so it is with puritanism. There’s no doubt we’re seeing a resurgence of puritanism in a variety of disguised forms. The essence of puritanism is pleasure is bad for you. 

Since many of our pleasures involve consuming things, this translates into consumption is bad for you. The locus of puritanical concern has, of course, been alcohol and latterly processed foods with a high content of salt and sugar. And sugary drinks have also featured recently, with the introduction of a sugar tax looming many producers are reformulating their products – Irn Bru and Ribena seem to be getting a lot of attention on Twitter!
 
So what’s behind this? What the new puritans of public health want is to alter “the architecture of choice”, to nudge or coerce consumers into making “healthy choices”. The argument goes like this – people make free choices about whether to buy products in a market place, but are these choices really free? If products such as alcohol, fizzy drinks and highly processed foods are available everywhere, people are exercising their freedom to choose in an “intoxogenic” and “obesogenic” environment. In other words, free choice is exercised within a deterministic framework that the person making the choice cannot influence. And anyway, the argument goes, cunning marketing and advertising makes people buy things they don’t need by persuading them to want them!
 
I sometimes think public health puritans live in a parallel universe. What they term the intoxogenic and obesogenic environment is merely the retail distribution system by another name. And since all of us are born into a society that existed before we did, and will exist after we’re gone, all choice is exercised within a deterministic framework.
 
So how do public health puritans plan to alter the architecture of choice? Taking alcohol as an example, their measures include raising alcohol duty by more than inflation every year and introducing minimum unit pricing (MUP) – these are measures that reduce affordability, or “economic availability” as they often call it. In addition, they propose changes to the way in which the retail distribution system handles the product. This has been tried elsewhere, for example, in Australia you can’t buy alcohol from supermarkets, only from separate liquor stores. The same applies in Canada where most liquor stores are owned and operated by the government. Effectively the off-trade is a nationalised industry. In Scotland, where MUP will be introduced on 1 May, there are demands being made to have separate alcohol aisles and checkouts for alcohol in supermarkets.
 
All these attempts at reconstructing the architecture of choice either make people poorer by raising prices, or they make shopping a more inconvenient and miserable experience. The likely effect will be to drive such sales online. So changing the architecture of choice really means taking choice away or making it more expensive and more inconvenient – all in the name of healthy choices.
 
At some point I think there will be a consumer rebellion against this. The Institute for Fiscal Studies estimates MUP at 50p in Scotland will have a dramatic impact on prices. Some cider products will rise in price by as much as 90% and 70% of the alcohol units bought in the off-trade will see prices rise.
 
Will these price rises tip people out of the living room and into the taproom? The Scottish Licensed Trade Association certainly thinks so. It has been campaigning for government price intervention in the off-trade since the abolition of resale price maintenance in 1964. But it is simplistic to think the price of alcohol is the only, or even the main thing that determines peoples’ decisions about whether to stay in or go out, and the supermarket is the enemy of the on-trade. This is just crude Tesco-bashing and it ignores the fact society has changed beyond recognition from the mid-1960s. Satellite television, Netflix, computer games, the huge development of fast food home delivery – all these things have transformed the home into a place to escape to, not from. It’s easy to get caught up in fighting yesterday’s battles while turning a blind eye to the complexities of the modern world.
 
I am aware of the problem of pre-loading, but I think this is more a product of later closing than cheap supermarket booze. And there is a new enemy on the horizon – one that threatens both sides of the trade: a puritanical public health lobby that is happy to drive a wedge between the on-trade and the off-trade. We can speculate whether MUP will or will not shift drinking back towards the pub and the bar, but we will know for certain whether this is the case in Scotland within the next 12 months.
Paul Chase is a director of CPL Training and a leading commentator on alcohol and health policy 
 

The challenge of technology integration by Alastair Scott

James Hacon’s article recently was, as a technology provider and an operator, very interesting and thought provoking reading in Friday Opinion. His core argument is the big technology players are reluctant to integrate with the smaller players, and even more so when they have a competing product. This is hampering innovation and just as importantly leading to a less efficient and/or effective sector.
 
My first point is this is understandable. The small players have most to gain from openness and the large ones the most to lose. Just watch how Apple has changed from arguing against the Microsoft machine to in effect adopting the Microsoft position now it is big enough to want to close out the competition. As a supplier that is transitioning from a small supplier to a larger one, I really do understand both arguments. So we should all understand in any commercial world that is how people will rationally behave. Therefore, the real question is what can operators do to ensure they have the freedom to choose the best systems and select a group of products that works for them?
 
My advice is to only work with people you trust and can have a relationship with. The cost of adopting most technology platforms is not in the cost of the product but in the substantial effort and energy it takes the organisation to change the working practices to make the most of the technology. As an operator we have had three different restaurant booking systems in four years and we wish we had made the right decision first time around. In my view it is more important to pick a partner that has a similar philosophy than the partner with the best product right now. For me that philosophy would critically include how they want to take the product forward, and also their attitude towards integration.
 
We have struggled with determining the right position regarding integrations. However, now we offer free access to the data we hold on behalf of our customers. Our commercial argument for this is other suppliers will be keener to work with us and thus will recommend us more positively and more frequently than our competitors. This integration decision is, of course, harder when your competition may have a competing product, but if you believe your product is the best product on the market it makes that decision much easier, which we of course do.
 
I believe we are only at the start of a major software revolution in the hospitality sector. Historically, because we run small individual units, the software costs have been prohibitive. With the software as a service model reducing the large upfront costs of purchasing software for a site, lots of sites can use the same platform giving a small site great massive economies of scale they haven’t been able to access before.
 
And so I think once we really apply our brains there will be lots more solutions, and they will come thick and fast. My advice to all operators is to understand your providers' approach to your data and make sure that it works for you. But then I would say that wouldn’t I – we still think like a small player.
Alastair Scott founded and runs S4labour, a productivity and labour scheduling solution for the hospitality industry

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