As the job market gets tighter and a global generational shift continues to reverberate throughout the workforce, employers are facing ever more complex staffing challenges. The foodservice industry is no exception. The Bureau of Labor Statistics reports that the sector’s employee turnover rate topped 72 percent in 2016. This figure includes management-level personnel—it’s reasonable to assume the percentage would be much higher for hourly employees.
A Cornell University study pegs the cost of turnover in the hospitality industry at more than $5,800 per employee. So a restaurant that has to replace three-quarters of its staff each year—the industry average—is losing a big chunk of its profitability to recruiting, hiring and training new employees.
The combination of the turnover rate and cost of turnover per employee requires a new and documented plan to manager labor—a staffing plan.
The SMART way to plan
Operators are accustomed to creating documented plans to support menu development, event execution, daypart extensions and other business objectives. The idea of creating such a plan for staffing is new to many operators. But the case for a staffing plan is clear, given the numbers cited above. A well-considered annual staffing plan will drive sales by ensuring a steady guest experience, increase profitability and enhance the guest experience.
To be truly effective, your annual staffing plan should emphasize the SMART criteria. It must be Specific, Measurable, Attainable, Realistic and Time-bound. And it should include at least these three key components of the staffing process: acquisition, onboarding and retention/motivation.
Your plan should set very specific goals for each of the three key components (and any others you choose to include). Also, identify the “owners” who will be responsible for each of the steps in the plan, by specific role or name. For example, the front-of-house manager is responsible for hiring servers, the back-of-house manager is responsible for hiring cooks and the general is responsible for conducting final interviews.
The goals you set must be measurable, so you and your team can track progress and stay motivated. The goals and your progress should be shared in weekly leadership meetings and posted for all to see—you want to inspire a “we’re all in this together” approach to the staffing challenge. Make the link between performance and achievement explicit by expressing progress in terms of savings or gain for the organization. For example, “We reduced turnover by 8 percent this quarter.”
Operators often reach too far when they first get into goal-setting. Optimism is good, but goals need to achievable to be successful. If your BOH turnover is currently at 84 percnet, you’re not likely to cut it in half in the space of a year. A better starting goal might be attaining a turnover rate of 75 percent.
In addition to considering whether you and your team have the ability, skill and talent to attain a goal, you must determine whether the goal is realistic in context of all the other things you have on your plate. You can’t devote all your time to pursuing a single goal. You should also take into account the real-world conditions surrounding your operation. If the turnover rate in your area is 70 percent and your rate is higher, a realistic goal might be to match the local average. Reaching new goals will likely require new behaviors and tactics, and those take time to learn and implement—it’s the positive trajectory toward the new goal that should be emphasized with your leadership team.
Every goal needs a target date, so you have a deadline to focus on and a guide to prioritize your efforts. Being specific with time also helps team members hold each other accountable. A standard practice is to set goals quarterly, which allows people enough time to get their tasks done while creating a sense of accomplishment and evolution toward your end state.
Key components of annual staffing plan
Once you understand the SMART criteria, you can use them to “frame out” your goals for acquisition, onboarding and retention/motivation. This should be a collaborative process—bring your team together to build a plan they will all own. You can use these starter questions to help facilitate the planning process:
- What technology will we employ to assist in the acquisition process?
- What external experts will we engage for help?
- What external events do we currently engage in to recruit new employees (e.g., job fairs)?
- What seasonal factors impact our hiring process?
- Have we accounted for all the hard (direct) and soft (indirect) costs of acquisition to determine the right solutions to meet our needs?
- What technology will we employ to assist in the onboarding process?
- What external experts will we engage for help?
- What tactics we will use to make onboarding easier?
- Have we accounted for all the hard and soft costs of onboarding to determine the right solutions to meet our needs?
- What is our current employee recognition program?
- How do we incentivize the “right” behavior within our teams?
- How do we reward tenure within our teams?
- How do we build team engagement and enable employees to participate in decision-making and strategy execution?
- How much will we have to set aside to invest in retention and motivation?
- How will we communicate our culture so employees can stand with us in our goals and values?
This is not about creating a pile of lengthy, complicated, highly technical paperwork. You and your team want to boil everything down to a concise, simple-to-understand document that is easily shared. However, it is prudent to engage a human resources expert to make sure the planning process and goals align with current employment laws and guidelines.
While the new employee landscape seems equally foreign to both veteran operators and newly minted restaurateurs, one thing is certain: a strategic approach to staffing is necessary for navigating the new terrain.
The content of this article is for informational purposes only. The information in this article cannot and should not stand in for guidance from your human resource experts.
The generational shift
The Western world is in the midst of a generational shift that is transforming both the demographics and attitudes of the workforce. Understanding this shift—and the new norms and values of post-boomer workers—is essential to creating a truly effective annual staffing plan. Visit the Idea Center at gfs.com/ideas and search Gen Z, Millennials and Gen X for insights and advice on recruiting, managing and retaining these different groups.