Lessons in Franchising: The Importance of Culture

Company Signs
Moment Editorial/Getty Images / Getty Images

I am fortunate. Like one out of three Americans, my first job was in the restaurant industry. At the age of 16, I started washing dishes in the two-compartment sink of an independent Italian restaurant in Lakewood NJ. The family who owned the restaurant was vibrant and energetic. They had a passion for the business, and their enthusiasm was contagious. And while the environment in the back of the house was energetic and at times boisterous, there was an unmistakable commitment to teamwork, a sense of urgency, and an attention to detail embraced by all.

And frankly, if you didn’t embrace those elements…the things that defined the culture of the restaurant…you weren’t going to last long. In many respects, I learned most important lessons of my restaurant career before I reached the age of 17. And chief among them was the importance of culture in our business.

Culture

For good or for bad, every place of business…and every brand…has a culture. To develop a successful brand, there are myriad details which must be tended to and executed with a high level of proficiency. After more than 42 years in this industry, I have had to deal with and master most of those details. In each niche of the business, there are mistakes (aka the fodder for progress) waiting to be made. A company and a brand can survive the vast majority of mistakes it experiences in its history. But the one thing that will most likely influence either the success or the demise of the business is its culture.

You know great culture when you see it. Within the restaurant industry, one such example is Chick Fil A. The Cathy family developed and grew a brand that, more than anything else, reflected a certain culture. In a segment of the industry overrun with mediocrity, Chick Fil A stands out as a quick service restaurant in a league of its own.

This did not happen by accident. It is by overt design, coupled with an unwavering commitment to keep that culture alive.

Mission Statements

When I joined Firehouse Subs in 2003, there were only 65 restaurants in the nine-year-old system. I was fortunate that the tenets of the founders were deeply engrained in the brand. The doctrines they adhered to constituted the culture of the brand. We would later embody their beliefs in our mission statement. But simply put in 2003, the founders had built their young brand on their unwavering commitment to serving hearty and flavorful food, providing heartfelt service, and giving back to their community. It didn’t take long for me to recognize that my number one mission would be to flame the passions that fueled the early success of the brand. Our culture would serve as the catalyst for future success. Thirteen years and almost a thousand restaurants later, our brand is stronger than ever. And we could not have achieved that if not for the hundreds of franchisees and their employees embracing the elements that define our culture. As we continue down the path toward 2500 restaurants in the USA, maintaining and building upon our culture is more important than ever.

As alluded to above, our most valuable lessons often come from our mistakes. Better yet is when we observe the mistakes of others and bake them into our own psyche. Almost 24 years ago, I learned one of the most valuable lessons of my professional life. And it is worth repeating here.

At that point in time, I had just passed the midpoint of what would become a 23-year career with BK. My role was then in the Operations R&D arm of the company. I’ll spare you the details, but suffice it to say that in 1992, the morale of the system was at a low point, both at HQ and within the franchise community. If BK had had a strong culture in the past, it is fair to say that at that juncture, it was in disarray.

On August 24 of that year, Hurricane Andrew plowed into the southern portion of Dade County, Florida.

At the center of the bullseye for that incredibly powerful storm was the headquarters building for Burger King Corporation. Over the course of six hours, the lives of my family and hundreds of other BK employees were turned completely upside down. Many of our personal homes were uninhabitable for months. And that was the case for Burger King’s HQ.

Back then, disaster preparedness was not as advanced as it is today. To the credit of the leadership team at BK, they stepped up to the plate in the wake of the storm and did everything right. By virtue of their actions, coupled with the challenges and hardships induced by the hurricane, there was an unpredictable shift in the culture of the company. The leadership of BK demonstrated their commitment to the HQ team, and in return, the loyalty and passion for the brand skyrocketed. For a company adrift, it was a pinnacle moment in history; an opportunity to chart a new course with a newly minted culture that should have carried the brand forward on a new trajectory.

Not all that long after moving into a refurbished HQ, the mantle of leadership passed into new hands, and one of the earliest initiatives was a sweeping reorganization of the company. The immense goodwill and cultural change that had been delivered on the winds of Andrew evaporated. In fact, the resounding sentiment was that the actions taken by the previous leadership team must have certainly been born out of necessity, rather than radiating from genuine goodwill and recognition of the value of those who were giving their professional lives to the brand.

Conclusion

The lesson was not lost on me. There has not been a time during the 24 years that have passed that I have not remembered just how fragile culture can be. It must be embraced by the very top of the organization, and by those fortunate enough to be handed the reins in the future. I have the privilege to serve at the highest level with another brand and have been relentlessly committed to ensuring all of my decisions are consistent with the culture that defines our company and our brand. I never wish to find myself in a situation where it takes an extraordinary external event like Hurricane Andrew to reverse the effects of cultural decline. While a natural disaster is not within our control, our culture most certainly is.