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Morning Briefing for pub, restaurant and food wervice operators

Fri 18th Jan 2019 - Friday Opinion
Subjects: How leaders build trust, growing into the overcoat and return to rationing
Authors: Chris Edger, Glynn Davis and Paul Chase

How leaders build trust by Chris Edger 

Trust lies at the heart of all productive interpersonal relationships. Deep levels of trust occur when individuals possess a firm belief in the integrity, ability or effectiveness of someone or something. 

In the dispersed multi-unit hospitality world – where employees and teams work in isolation from the centre and their immediate bosses – it is achieved when the leadership of the organisation is emotionally intelligent enough (in spite of physical constraints) to close the psychological distance between itself and its units. But why is it important, what is the state of trust within business today, and how do leaders build it?

Why is trust important? One reason is humans have a primal instinct to survive. As Darwin observed more than 150 years ago, the survival and procreation of the human species depends not only on evolutionary adaptation but also on a sixth sense to identify and anticipate danger. In short – as further neurological and scientific investigation has proved – we are hard-wired to sense whether we trust or distrust someone or something based on natural instinct. It follows that leaders and managers must obey this irrefutable law of nature in their dealings with others and act in a trustworthy manner if they want to develop productive relationships.

Trust is also important because building it within organisations has proved a hard economic virtue that gives a business its competitive advantage. The Franklin Covey Institute, which has conducted an immense amount of analysis and work in this area, estimates high-trust companies are two and a half times more likely to be high-performing revenue companies than low-trust companies. High-trust organisations with good climates have greater longevity, higher productivity, better retention and superior agility.

What is the state of trust in organisations today? According to Franklin Covey Institute research in 2016, less than half (49%) of employees “trusted” senior management and a measly 28% believed chief executives were a “credible source of information”. Obviously business doesn’t operate in a vacuum – there has been a growing trend of declining trust in authority figures globally and a growing scepticism over “fake news”. 

For our industry, where almost two-thirds of employees are under 25, the 2018 Deloitte Millennial Survey that questioned 12,000 millennials and Generation Zs presented an equally dismal picture. Less than half (47%) believed business leaders were “committed to helping improve society”, three-quarters (75%) thought business leaders “focused on their own agenda rather than considering the wider society” and 62% said business leaders had “no ambition beyond wanting to make money”.

How do leaders build trust? A decade ago I founded the Academy of Multi-Unit Leadership, which has taught and developed more than 800 multi-site leaders from 22 leisure and hospitality companies on its post-graduate programmes. At the start of my service leadership module I always ask my multi-site leaders to reflect on and discuss the qualities of hospitality leaders they admire. Trust always features at the top of the list – but how is it built? Here are the five main components, accompanied by living exemplars cited by academy students:

Credibility – something established through perceived levels of knowledge, competence, capability, expertise, skills, results and track record. People are more apt to trust someone who has “been there and got the T-shirt” or “walked a mile in their shoes” than a “Johnny-cum-lately bullsh***er”. Regarding the first two statements, Ian Payne and Simon Longbottom, chairman and chief executive of Stonegate Pub Company respectively, are mentioned regularly. They are both held in the highest regard as leaders who have travelled from “bar to boardroom” while retaining an infectious, messianic belief in the pub industry and those who work in it.

Character – exhibiting virtues and values such as integrity, ethics, resilience, authenticity and humility. A leader’s ability to absorb pressure and treat people with grace while under sustained fire garners intense levels of love and loyalty from those they lead. Phil Urban, chief executive of Mitchells & Butlers, and Jens Hofma, chief executive of Pizza Hut, are highly admired for the tenacity and character they have shown while stabilising and growing their respective companies in extremely challenging circumstances.

Consistency – steadfastly consistent in decision-making and delivering promises while being perceived as “firm but fair”. In the tenanted and leased world, Punch chief executive Clive Chesser is frequently cited by business managers on my programmes as someone who acts with an even hand, balancing the needs of his tenants/lessees with the requirements of his business.

Care – a genuine and heartfelt interest in the welfare, well-being and happiness of employees. Students cite many leaders but in addition to those above, McDonald’s chief executive Steve Easterbrook and JD Wetherspoon chairman Tim Martin also stand out. In spite of recent events on the ground, both individuals are seen as being singularly vested in driving industry-leading and generous training, development, progression, reward, bonus and incentive programmes resulting in high rates of retention, engagement and advocacy at all levels of their organisations.

Clarity – with regards to purpose, meaning and direction. Peter Borg-Neal, founder of Oakman Inns and Restaurants, and Bistrot Pierre founders Rob Beecham and John Whitehead are highly admired by our academy delegates for the simplicity, clarity and inspirational tone of their communications. Their people “get” and buy into what Peter, John and Rob are trying to achieve (albeit in different concepts) – delivering memorable service with delightful food and drink in iconic, stylish surroundings. 

In summary, trust is crucial in building and sustaining high-performance organisations. In society and across business in general, trust in authority figures is declining. However, hospitality leaders who opt to build trust through being demonstrably credible, characterful, consistent, caring and clear can gain a real competitive advantage. Trust is the fundamental foundation and cornerstone of all productive human relations. Nurture it as business leaders and you will be commercially rewarded – abuse it and you will be financially punished!
Professor Chris Edger is a lecturer, coach and multiple author on multi-site franchising, branded and service leadership

Growing into the overcoat by Glynn Davis

New York-based Brooklyn Brewery is undoubtedly one of the most successful US craft brewers having built a global presence since its creation in 1988 helped by its flagship amber lager and iconic label.

By employing graphic designer Milton Glaser – best known for his I Love New York design – to create its logo, Brooklyn Brewery recognised the power of visuals and relevant communications would resonate with a hip audience jaded by clone-like big brewers.

When I met Brooklyn Brewery co-founder Steve Hindy a few years ago he suggested craft brewers from that early period were adept at engaging with their core demographic, which gave them a massive advantage over the large, incumbent brewers that had long lost a personal connection with their drinking communities.

He perceives this situation as also ringing true for today’s generation of craft brewers, which have been able to commandeer social media to great advantage in a way the big operators have been unable to. He likens social media to an overcoat – the large brewers can put it on but it doesn’t fit. In contrast, it fits snugly on the nimble limbs of craft brewers.

It’s clear to me that social media has had a massively positive impact on the UK’s craft brewers and beer scene – to such an extent I was genuinely surprised by the modest volumes many of them still produce annually even though they appear to have impressive reach and engagement across social media.

This is certainly true of Manchester-based Cloudwater Brew Co. It is ranked second-best brewery in the world by RateBeer, which dishes out annual awards for the world’s best-rated beers and brewers based on scores from drinkers around the world. Cloudwater’s accolade isn’t particularly surprising when you consider the incredibly high quality of beer it has produced since it was founded in 2014, with its first beers hitting the bars early the next year.

Such success and high-profile recognition undoubtedly creates masses of social media and Cloudwater has been proactive in engaging with its audience across various channels. Proof of this came when my enquiry about the brewery’s annual production was placed – and answered – on Twitter. The answer surprised me. In 2017, Cloudwater produced a modest 4,700 hectolitres, which rose to about 6,000 hectolitres in 2018.

London-based Brew By Numbers is another superb craft brewer and in my view is one of the best and most consistent breweries in the country. It has a presence in many of the best craft beer bars and uses social media effectively but, again, we have a brewery with a modest output of 6,000 hectolitres this past year – a figure I also received via Twitter.

These numbers may not mean a lot to most and I have to admit measurements in the brewing world are complicated so let me put this in context – Timothy Taylor’s brewery in Keighley, Yorkshire, produces more than 64,000 hectolitres a year of its flagship Landlord bitter.

This is one of the world’s greatest beers and has a reputation around the globe but to many younger, craft beer-focused drinkers it might be hidden from view and even unknown. However, it doesn’t have the engagement levels of the likes of Cloudwater and Brew By Numbers on social media – despite having a superb product. The overcoat doesn’t quite fit.

It will be interesting to see if many of the hundreds of craft brewers founded in recent years will successfully translate the engagement and level of noise they create on social media into actual sales.
Glynn Davis is a leading commentator on retail trends

Return to rationing

We’re in the middle of the annual Dry January campaign run by Alcohol Change UK (ACUK) – the organisation formed by the merger of sock-puppet faux charities Alcohol Concern and Alcohol Research UK. 

Buyers’ remorse is allegedly kicking in and ACUK is exhorting us on social media to give abstinence a try. The benefits include saving money and, apparently, losing weight. This fits in nicely with Public Health England’s ongoing moral panic about soaring rates of adult obesity (they aren’t soaring) and the childhood obesity crisis (there isn’t one). Children, of course, aren’t meant to drink alcohol but they are exposed to alcohol advertising and marketing and therefore, in the view of these nanny-state scolds, are potential alcoholics in waiting

It might seem obvious that since beverage alcohol contains calories it contributes to weight gain in the same way doughnuts do. If the drinker imbibes to excess and doesn’t burn off the calories with exercise, he or she will put on weight. The first law of thermodynamics applies – consume more fuel than you burn and your body will store the excess. Actually, it’s not that simple. 

Most people think the main source of calories in beer and other beverage alcohol is carbohydrate. Wrong. It’s alcohol. And any alcoholic drink will deliver calories in proportion to its alcoholic strength. In any event, the view of the public health racket is that calories derived from alcohol are dead calories and have no nutritional value.

Let’s get a couple of facts straight. Firstly, people don’t drink undiluted ethyl alcohol they drink beverage alcohol such as beer, which contains a range of nutritious ingredients. Beer contains high levels of most B vitamins, notably folic acid; it is one of the richest sources of silicate in the diet, which has been linked to a reduced risk of osteoporosis in moderate drinkers; and contains significant levels of soluble fibre and antioxidants, at least one of which – ferulic acid – is absorbed by the drinker’s digestive system.

The reason alcohol doesn’t necessarily increase weight is unclear but research suggests alcohol energy is inefficiently used. Alcohol also appears to significantly increase metabolic rate, causing more calories to be burned than stored in the body as fat. Other research has found the consumption of sugar decreases as the consumption of alcohol increases. Whatever the reasons, the moderate consumption of alcohol doesn’t correlate with weight gain and is sometimes associated with weight loss in women. The evidence is based on a large number of studies of thousands of people around the world. Some of these studies are very large indeed – one involved almost 80,000 and another 140,000 subjects.

The moderate consumption of alcohol is associated with better health and longer life than lifelong abstention or alcohol abuse. However, heavy drinking is associated with cirrhosis of the liver and other health problems. The key word is “moderation”. In relation to weight gain, the facts are that while beer, wine and distilled spirits all contain carbohydrates they contain no fats whatsoever.

The “obesity epidemic” is just the latest in an endless stream of issues the public health racket, with its obsessive desire to regulate lifestyle, uses to scapegoat a pantheon of industry hobgoblins it blames for all our ills. If these groups can spend their days campaigning to reduce consumption of alcoholic drinks and fizzy drinks by linking an assault on the “binge-drinking epidemic” (it’s going down) with “soaring rates of obesity” (they aren’t going up), they go home happy.

A recent compendium of statistics from the British Heart Foundation included a statement some might find surprising: “Overall intake of calories, fat and saturated fat has decreased since the 1970s. This trend is accompanied by a decrease in sugar and salt intake, and an increase in fibre, fruit and vegetable intake.”

Sedentary lifestyles, the loss of heavy industry and the rise of office jobs together with less emphasis on sport at school, with many schools selling their playing fields, all play a large part in weight gain. But public health campaigns to reduce alcohol consumption in the name of fighting obesity are simply fatuous attempts to find yet more sticks to beat us with. You know in their secret hearts these campaigners won’t be happy until we’re all issued with ration books.
Paul Chase is director of CPL Training and a leading commentator on alcohol and health policy

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