Q&A with Bistro Group Chairman Bill Stelton on Service Culture

William ‘Bill’ Stelton is Chairman and CEO of The Bistro Group, a leading high end casual dining restaurant chain in the Philippines (with brands such as TGI Fridays, Italianni’s, Denny’s, Texas Roadhouse, Watami, Baker & Cook, Red Lobster and Hard Rock Café, among others). The Bistro Group, now with some 100 outlets nationwide, is celebrating its 25th year this year. Bill also owns fifteen other companies, including Technolux, the market leader in high quality kitchen and laundry equipment in the Philippines. He shares with us the importance of building and maintaining a positive service culture in service-driven enterprises like restaurants. 

Q1: You like to say that the reason why your group is one of the most successful high end casual restaurant is because of the service culture. What exactly is the BISTRO Group service culture?

A1: Service culture is only a result of a caring culture.  It starts with genuine interest in your people, in caring about their well-being, in being as giving as you can, even if their needs are no longer work-related. 

Bistro’s service culture is like having a good relationship with your family and friends.  It is not hierarchical, or me and their managers as the bosses, while they are my subordinates. Bosses are treated merely as firsts among equals, we try our best to make employees feel they are not subordinates but part of the team.

In Bistro Group, we try to know each individual. The closer we are to them, the more we understand them. We ask about their family, what they are going through, and what we can do for them. We learn about their daily battles — we need to understand their personal worries, otherwise, misunderstanding becomes common place. The supervisors must know the personal concerns of their subordinates and what they are facing at home in order to make them succeed. Many of our people are single parents and are the only providers in their families, so if we need to extend help on a personal level, we will. We have done a lot of charitable work for others, so extending a helping hand to our employees comes naturally.

I wake up every morning with one question “What can I do to help someone today?” I find pleasure in helping others. There is nothing heroic here, giving is its own reward.  It also prevents others from getting into trouble, or getting into deeper trouble. I grew up like most of our employees with little money in the pocket. But somehow, good fortune and the kindness of others helped me achieve a better life. At 17, I had only ten cents in my pocket, just enough to pay for transportation to apply for a job, and then I had to walk home because that was all the money I had. So I know the challenges my team are going through daily and they have the focus of my attention. That’s why many of our people stay a long time because of the Bistro service culture. I now have fifteen companies and all GMs of my companies started from the bottom and have stayed over twenty years. They were waiters, technicians, rank and file employees. Bistro group president Paul Manuud used to work in the kitchen and now he is president of the entire Bistro Group.

Q2: In terms of service culture, how do you get everyone on the same page about service that delights customers? Is there a process to it? 

A2: The inter-relatedness of so many elements in harmony like recruitment, screening, training, team building, role modeling, empowerment, coordination meetings, rewards and many others are keys to delight customers. 

First, we hire people who have pleasing personalities, customers simply won’t return if they don’t like what they see and feel. I started my casual dining business with TGI Fridays and they are the best in training. We like to hire people with a “Fridays” personality – people who smile a lot, have a lot of fun, a caring attitude, are sensitive to the needs of others, but not sensitive to comments or criticism. All front liners must have this standard.

Then, we share our expectations and teach newcomers to be observant. Like a couple who used to frequent an Italianni’s branch and then one day, only the wife was returning. The server discovered that her husband passed away. The server listened to her story as she related her relationship with her husband and how she missed her routine with him.  Moved by her story, the server gave her a small token as a show of concern and empathy.

After a month of training, our newcomers continue to learn by watching their peers on the job. They will see them picking up napkins or anything dropped, or reminding customers they forgot to close their bags, etc. We do not just preach, we do tasks ourselves and newcomers become witnesses to how their role models work.

There are daily, weekly, and monthly store meetings. We use these meetings not just to make announcements but to coordinate, and to call out exceptional service as well as comments made by customers. We exert effort in recognizing the good thing that they do rather than to look for faults. During quarterly financial reviews with all store general managers, director for operations (each handling about seven stores) and vice presidents in charge of our respective brands, exceptional high performers are invited to observe the meetings and their outstanding performance are recognized in front of everyone. It is also a chance for me to meet them and thank them.

Many of our best performers have been nominated and have won the most outstanding employees not only in the Philippines but internationally. A dishwasher who has been with us for 17 years was chosen as the most outstanding employee of Fridays worldwide. He won the True Believer award.  He was invited by Fridays to go to the US to receive his award and we gave a scholarship to one of his children. No one is too small!  Anybody can do outstanding service job and they are recognized for it.

Every year, I choose a few people among high potential performers to join me on observation tours abroad. They get to be updated with what’s happening elsewhere, learn from others and thus elevate their crafts. They must feel they are one with us, that our success is their success, and their success makes us more successful.

Q3: How are your service front liners chosen, screened and trained? How do you know they have real positive service attitude? 

A3: We have the Bistro’s Likability rule, meaning, if we can’t like you in 5 seconds, how can customers like you? If customers like you, they will likely forgive you in the most unlikely case of a foul-up. We also have high preference to hire people with no prior experience in the restaurant business.  It is easier to teach and mold them to understand our culture.

We hire interns but they are not a guarantee for retention. We have high expectations and high standards, so training is crucial. It is an acceptable practice in Bistro for general managers to bypass HR to invite people to work with us, particularly people with a Fridays personality.  We know that sometimes, some of the applicants may not even have the money for transport to process their papers, so we make it easier for them to start working for us.

Managers observe, decode signals and validate their observations. The service culture will also make newcomers likely to follow the lead of their peers, and we also have controls because in each table, customers can participate in “textify” and give feedback directly to top management, real time.

The service charges are shared equally by everyone including kitchen staff, but tips go directly to servers so they have all the motivation to pay attention and do a good job consistently. 

While food must be good, ultimately, customers return to Bistro because of our service culture. Looks are important, but actions speak louder. 

Q4: What service management practices do you think are unique to your restaurants? Why do you do these?

A4:  We try to ensure that you feel you are in a Bistro restaurant the moment you come in.  We do it consistently, whoever you are. We have a welcoming attitude – we smile, we acknowledge your presence immediately, we care how you feel upon entry, we pay attention within the first three seconds. Managers are trained to run to customers with a simple raising of their hands.

In Bistro, we give the same treatment, service does not depend on who is being served. It is consistent to all. This requires mindfulness, training, coaching and counseling. Plus paying attention to details, and doing many little things that mean a lot to the customers.

Q5: Beyond offering good service, there are more fundamental factors in restaurants. Your success rate is a phenomenal 80%+ (versus less than 30% in the restaurant industry). What do you look for before giving the go signal for a new venture? What is a reasonable ROI?

A5: First, I must like the feel when I enter and stay in a restaurant. When I entered TGI Fridays in the US, I felt the “electricity” immediately, so I decided to bring it to the Philippines in 1994. It was the single most expensive restaurant in the Philippines at the time. Budgeted at P35 million but the actual cost went up to P63 million because I was given a 1,000 sq. meter restaurant in Glorietta which became the biggest TGI Fridays in the world at that time. For the first four years, we had 600 customers inside during peak time and 500 people waiting outside that we had to do mob control daily. While my board was unhappy about being over-budget, we paid back all investment in about eighteen months. Credit card was not popular then so we had majority of our sales in cash which could not fit the vault anymore. Because of the success of Fridays, other major brands started coming to us to offer us their franchise.

Second, I must like their food. Food is the first reason why we go to a restaurant so it must be delicious. 

Third, I must be able to find a differentiation. In the case of TGI Fridays, the energy and the memorabilia mattered a lot initially. 

Fourth, I travel overseas and attend international conferences a lot, so it must be within the trends expected. For instance, I know younger people do not like to eat where their parents eat, and they want their food served fast, with the least interruption. They also like good presentation so they can post it in their Instagram.

Fifth, a known international brand does not guarantee local success. We bring a lot to the table.  Foreign franchisors need to be reasonable and willing to be flexible. They must be good listeners. They should ensure their franchisees will be profitable and agree to allow some adjustments to conform to local taste. Some demand for high, unreasonable franchise and royalty fees or ask us to commit to build unreasonable number of stores. We normally negotiate everything to what will be reasonable to make a profit. If the first store makes money, we will continue building.  The more profitable they become, the faster we build.  No need to dictate to us. I simply walk away if the conditions are one sided. Franchisors must not be too rigid in preventing us to develop other brands. We need to be a major player in the casual segment, in order to get the best locations and have the lowest possible cost without sacrificing quality. Category dominance cannot be done with a single brand. No one can eat in the same restaurant everyday.

Finally, a return of investment of three years is good. Initially, a return of 18 months to 24 months was the norm.  With the advent of competition, three to four year payback is acceptable. A “honeymoon” (high sales) of one month is normal, over one month is good as it will trigger a buzz and 6 months is fantastic, We were lucky to have a four-year honeymoon with TGI Fridays, something rare in the restaurant industry today.  If you have to continuously put out money after a restaurant opens, in all probability, the brand is unacceptable to the public.  It is better to close and change the concept.

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