Posts Tagged ‘pizza hut’

Restaurant Careers: The Path From Dishwasher To Chief Executive Officer May Now Include A Stop At Harvard

Sunday, November 28th, 2010

For years the food services industry has been labeled an industry for low pay and low skills. Research recently completed by Plummer & Associates, an executive search firm, shows quite the opposite. The food service industry now has highly educated leaders.

This new study on the education of Chief Executive Officers at the top 100 food service chains in the United States shows that today over 68% have college degrees. This study also shows a growing trend of CEO’s with advanced degrees as 18% hold MBA degrees, 2% hold MA/MS degrees, and 4% hold JD degrees.

For years the food service industry was known for its career path from ‘dishwasher to CEO’. Our research indicates that while this may have been a viable path in the past, the current trend is for a minimum of a college degree and there is an increasing importance placed on advanced degrees. This demonstrates the importance of the sophisticated intellectual tools and the strategic vision gained through higher education.

Like with other segments of the retail industry, the food service sector has consolidated from regional companies led by founding families into massive, complex businesses requiring sophisticated tools to manage them effectively. This new breed of food service businesses are intensely competitive and are constantly looking for cost and marketing advantages to enhance their market position.

According to Plummer & Associates, some of the complexities facing the food service industry demand a command of the following disciplines:

 Marketing – Sophisticated tools have elevated the ability to forecast demand and to measure customer buying pattern changes. These tools also help measure brand awareness, customer loyalty, and the return on investment for all marketing programs. With the advent of social network marketing, the methodology of communicating with the customer is changing.
 Merchandising – Food trends and tastes are constantly evolving. To create a competitive edge it is important that food service organizations be active in planning product life cycles, assortment strategies, and new product introductions backed by a superior product development process. All these strategies must mesh well with operations to prevent overwhelming production and unnecessarily impacting quality and costs.
 Supply Chain Management/Logistics – Today there are tools available to help food service companies secure significant cost advantages throughout the supply chain while simultaneously improving the quality of customer service. This can provide organizations with a significant advantage over competitors.
 Finance – This function has quickly progressed from recording history to active involvement in ‘creating value’ through analytics. This is important as the company competes in the market for capital.
 Legal – Our society has become more litigious making larger businesses more of an attractive target. The complexity of new regulations has resulted in an increase of the legal staff. A food service leader is now required to be more involved and responsible for setting the tone of legal strategies.
 Human Resources – Once considered just an expense, Human Resources managed effectively must now create differentiation versus the competitors. A company’s talent and culture, including a devotion to the customer, are now more important than ever.
 Information Technology – In the past, technology seemed to be the sole domain of the IT department. With advanced POS systems, the food service organizations learned the power of information and the ability to forecast demand by day part. Now, leading IT departments interrelate with the entire organization by providing useful information to aid in decision making, control costs, forecast and analyze. Companies are now operating enterprise wide systems and it is becoming mandatory that the CEO know the capabilities of these systems to ensure the company gains a competitive edge.
 Global Reach – The days when food service companies only operated stores in the U.S. with product secured from U.S. sources are long gone. The implications of global activities are enormous.

Forward thinking food service companies such as Pepsico (Yum!) and Pillsbury/Grand Met (Burger King) who saw the need for talented executives started recruiting programs to attract students from colleges and also actively recruited MBA’s. These recruiting programs are responsible for the majority of CEO’s now leading the food service industry.

For those who are looking to progress up the ladder in food service, the data demonstrates that it takes more than experience in the industry to become a CEO. The food service business now requires the sophistication that comes with a college education and the trend shows an increasing demand for the additional tools gained in an MBA program.

The research shows that a college education is far more important than the particular school attended. While Ohio State University produced three CEO’s, the University of Kentucky produced two, and the University of Central Florida produced two, no other school produced more than one. On the other hand, in regards to CEO’s with MBA degrees, the Graduate School of Business at Harvard University produced four which is statistically important. Close behind is the University of Chicago producing two. It is clear that the industry prefers graduates from the top tier graduate business schools.

Retail Careers: Why College Graduates Should Seriously Consider Retail For a Career

Wednesday, August 11th, 2010

Following is an article on ‘Why College Graduates Should Seriously Consider Retail as a Career’. I published this article earlier in the year. I feel this is timely. I also feel the industry must do more to boost its reputation within the academic community.

Plummer & Associates, a Retail Industry Expert Offers The Following Advice to Students Entering Careers in Retail…

John Plummer, Plummer & Associates

Plummer & Associates, a Retail Industry Expert describes why Retail is now an attractive career for college graduates.

With over 40 years experience in human resources management and search consulting, John Plummer has developed a highly consultative approach to executive recruiting and as a human resources executive, he held senior management positions with major retailers.
John Plummer currently is President, Plummer & Associates, a New Canaan, Connecticut, based boutique executive search consulting firm which specializes in recruiting senior officers for the retail industry. Over the years, he has recruited teams for growth retailers (Staples, Starbucks, 24 Hour Fitness, Urban Outfitters, Anthropologie, Hot Topic!, Chipotle, Jamba Juice, Ulta Salon Cosmetics & Fragrances, The North Face, and many more of the retailers) that have changed the retail landscape. Previously, he had served as a human resources executive for divisions of Federated Department Stores, Fedmart*, and Mervyn’s. He graduated with his MBA degree in 1968 from the University of Southern California and also earned his BA in economics from USC.

“Many years ago when I graduated with an MBA degree, I joined Bullock’s Department Stores in Los Angeles where I had already been working on a part-time basis. I quickly heard from Professors and peers that I had made the wrong choice. They said the industry was not sophisticated enough to use my newly learned tools nor would retail offer the challenges needed. Being contrary, I decided to stay. Of course, being paid more than anyone else in his class comforted him a great deal. “
Well, things have changed. Retail is now a highly complex and sophisticated industry offering incredible challenges and the opportunity to put your new skills to work. When John Plummer joined retail, the organizations were primarily run by owning families and few executives were college educated and most were tactical in orientation. Now, the leaders of the top retail organizations are well-educated with over 85 % having college degrees(1) and 23% having MBA degrees(1). As retail continues to grow Plummer & Associates expects the percentage with college degrees will approach 100% and that the percentage with MBA degrees will be close behind.
What has changed….
First, the industry has consolidated from mostly family-owned and managed regional chains into large corporations operating nationwide and globally.
Secondly, these large businesses are in a highly competitive environment and require sophisticated solutions to strengthen the relationship with the consumer, to manage inventories effectively, to effectively utilize operating and capital expenditures, and to build management, systems, and other infrastructure to support growth and to serve the customer.
Thirdly, the industry works in an ever changing environment in which new ways to serve the customer are constantly being invented along with new ways to communicate with the customer. More importantly, the customer base needs to be better understood to seek ways to better serve the targeted customer as well as to understand consumers who could be effectively served and brought into the customer base. E-commerce has become mainstream over the past few years and opportunities through mobile-commerce are just starting to grow. Who knows what the next channel will be.
Fourthly, global growth in retail has been slow to take hold but is now a significant opportunity. For years global retail seemed to be limited to the luxury brands. Now, the food service industry is rapidly expanding on a global basis (examples: McDonalds, Yum!, Starbucks, etc). Mass merchandising is also expanding rapidly with Carrefour having stores worldwide and Wal-Mart, Staples, Best Buy, Costco, and others catching up. This growth demands executives who have the tools to be effective in different cultures with differing ground-rules.
Lastly, the industry is led by executives who know that highly talented executives are required to lead the businesses going forward. These executives have organized the business so that college graduates can quickly assume roles with responsibilities and require intellectual rigor and offer greater satisfaction.
The Opportunities…
Marketing…
Market Research – The industry is learning more about how to target consumer segments and how the company can expand that customer base without negatively impacting on the relationship with the core targeted customer. The opportunities are significant for the individual who knows how to design research and who is able to interpret the information into strategies.
Advertising/Sales Promotion – This was what retail was known for and is still an important role. But, with the growing use of social media the communication with customers is changing dramatically.
Merchandising – This role is constantly evolving. Merchants no longer make decisions based upon ‘gut feel’. In the past the manufacturer had all the customer information. Retailers with sophisticated point-of-sale information now know which products best meet their customer needs. As a result, the merchant is now an interpreter of the research and sales data and is often partnering with the manufacturer in product design, quality control, and costing.
Brand Management- Retailers now know that a nameplate is no longer sufficient and that strong brand management principles are required to be consistently successful and that the brand must be carried out through all marketing materials, the store experience and the e-commerce experience. This requires that marketing be involved in store operations, store design, human resources and all other areas of the enterprise.
Management…
Store Management – Retail is a labor intensive industry regardless if it is in the food service, retail services, grocery, or fashion sectors. The industry will always need executives who can manage people effectively towards meeting customer expectations and to carry out the essence of the brand.
Operations Management – The opportunities in supply chain management are significant. The efficient movement of merchandise is critical to stay competitive.
Store Development – As retailers look for better predictors of success in store locations and store design, executives are needed with sophisticated financial modeling tools, location selection tools, and store design tools. Green tools are also highly important to reduce energy costs and carbon footprints.
Process Improvement – As with any older industry in a new innovative climate, the retail industry now requires executives who can evaluate procedures and processes starting with a fresh pad rather than looking for incremental improvements.
Finance…
Accounting/Reporting – With new financial systems, the size of the accounting and reporting organizations has shrunk but opportunities exist for those who know how to work with and get the most out of financial systems.
Financial Planning & Analysis – Retailers look to the financial organization to provide the analytics and lead in the development of forecasts and budget planning. Opportunities are significant for those with strong analytical tools.
Creating Value –The role of financial executives as teachers and coaches in working with the other functions in the organization to help them understand the financial implications of their decisions is growing in importance.
Corporate Finance – Retailers require financing to support inventories all year and also require financing to support growth.
Information Technology …
Over the past few years systems have been developed for merchandising, supply chain management, financial management, and operations management. Now, systems are being built to better handle channels such as e-commerce, direct marketing, m-commerce, and shop-television. In addition, new communications are being established with social networking and media. This is creating a demand for executives with greater IT knowledge.
Human Resources …
Talent Acquisition… Because retail is people intensive, there is always a need to recruit people. More important, is recruiting top talent with the appropriate skills and style to meet the company’s objectives. Understanding new methodologies to recruit talent through social networking and other new practices, policies, and procedures is increasingly important.
Human Capital Development… Identifying talent within the organization and developing that talent to each individual’s potential is significantly important to the survival of a retailer in supporting growth and achieving brand standards throughout the organization.
Talent Retention… No good retailer can afford to lose good talent. Understanding what causes talent to leave and understanding what it takes to retain top talent is of utmost importance.
Compensation and Benefits… Retail has moved to understanding the importance of talent and retaining top talent. As a result, compensation and benefit plans are needed to provide the best return on investment.
Human Capital is no longer considered an expense. Instead, it creates a major differentiation between one retailer and all others.

Which Industry Segments Offer Opportunities
Food Service – Growth in the food service sector is significant. The best growth opportunities are in quick serve and quick casual. Look at the growth of Starbucks, Yum! (Taco Bell, Pizza Hut, KFC), Chipotle’, Jamba Juice, both in the U.S. and internationally. The opportunities because of this growth are significant. Only the sit down dining sector is experiencing slow growth.
Fashion Specialty – Although the U.S. has been over-stored in fashion, the shake out due to the recession is creating new opportunities for the stronger retailers. In addition, fashion manufacturers are opening company owned retail stores.
Hard-lines Specialty – This sector has faced the most challenges during this recession. Growth has slowed for most hard-lines retailers. The growth opportunities are primarily with Home Depot, Lowes, Dick’s Sporting Goods, AutoZone, Petsmart, and similar operations.
Mass Merchandising – This group consists of Wal-Mart, Target, Carrefour, Costco, Sam’s Club, Metro and similar chains. These are sophisticated and driven retail organizations offering significant opportunities in the U.S. and globally. These retailers are also broadening their customer bases and are expanding their merchandise assortments.
Grocery – The grocery industry was caught off guard with the advent of the warehouse clubs and the entrance of mass merchandisers into the grocery categories. These retailers are fighting back through the development of better operating strategies and marketing strategies. It was just announced that almost 50% of Wal-Mart sales are from the grocery categories. At the same time, new successful concepts such as Trader Joe’s, Aldi, and Whole Foods are growing rapidly.
HBA/Drug – This segment has consolidated heavily down to only a couple of major players who are highly sophisticated. They are also redesigning the business model through the addition of mini health clinics and the addition of third party drug provision services. The innovation in this segment will grow in geometric progression.
Retail Services – This is another major growth category and is a result of consumers need for services provided by a reliable brand. All you need to do is look at the growth of Geek Squad, Jiffy Lube, Jackson – Hewitt Tax Service, California Closets, Aamco, Merry Maids, just to name a few.
E-commerce, catalog, shop television, direct selling, direct marketing, m-mobile – The growth of e-commerce has taken share away from traditional catalog retail and direct selling and direct marketing channels. The emergence of multi-channel strategies and the advent of m-commerce will ensure growth in this broad sector.
New Ventures – This has always been the most exciting part of retail. Just look at the new companies that have developed within the last twenty years into industry dominance. For example, look at Starbucks, Staples, Office Depot, Anthropologie/Urban Outfitters, Amazon, PeaPod, 24 Hour Fitness, Trader Joe’s, Whole Foods, Geek Squad, Best Buy Mobile, Jamba Juice, Chipotle’ Mexican Grill, and all the other major retailers which have evolved from a twinkle in the eye to powerhouses.
What is the most rewarding factor?
The most important feed back an executive finds in the retail industry is the customer’s response to new actions and strategies. Regardless of whether you run an entire retail organization or just a small market, you can quickly see the results of your activities. This inspires self-confidence and drives your ambition to do and try more. Nothing builds esteem like seeing your success!
How to investigate a career in retail?
Check with your placement office for when a retailer will be interviewing at your school. If retailers are not interviewing at your school, I strongly recommend you contact the senior human resources executive at the retailer you are interested in joining. A letter to that executive will get you considered for the company’s executive development program. You may find a position at a local branch at a major chain, but that usually will not offer you the opportunity to quickly move into a decision making role.
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Retail Executives: Now is the time for retailers to recruit Strategic Hires !

Tuesday, July 27th, 2010

The National Bureau of Economic Research (NBER) has declared that the recession is officially over. For retailers, the question is how robust will the economy be in the next couple of years. Most economists and Mr. Ben Bernanke, Chairman – Federal Reserve, are forecasting a slow recovery. Why? The economy still needs to work through consumer debt and the consumer needs to find ways to increase their income so that they can spend again. In the recent past, consumers spent wealth gained through the inflated housing market. Unemployment is still high and will take time to recover. And, the baby boom generation is moving into retirement which means that this big population bubble will be spending less.

So, why is now the best time to bring on strategic hires? First, let’s define strategic hires as executives who can do significantly more than the incumbent. More importantly, let us define a strategic hire as someone who will help change the course of your business. This will be someone who is more strategically oriented to:
• Analyze the customer base to refine the definition of the targeted customer and then develop marketing programs to communicate with the newly targeted customer to increase traffic, sales, and margins;
• Create a store environment which matches/exceeds the targeted customer’s expectations and allows you to build a brand through the retail experience;
• Seek ways to find basis point improvements in operations efficiencies while also improving customer service;
• Build a culture which meets/exceeds customer expectations and recruit and develop exceptional talent;
• Build a merchandising program which excels at providing the merchandise expected by the targeted customer, which constantly reviews new products and categories while rationalizing existing sku’s, which excels at making money through effective merchandising and consistently finds margin basis point improvements, and which creates excitement for the merchandising program throughout the company;
• Lead a finance team which is more than a recorder of numbers to one dedicated to helping the organization by providing the analytics and instructions for the merchants to understand the financial impact of their decision making and for the other functional areas to understand the best return on investment strategies. This is a Value Creator!;
• Build a supply chain program which results in reduced inventories with the same or better levels of customer service while also reducing logistical expenses;
• Build systems to support the operational, marketing, and merchandising program enhancements; and
• Develop strategies to expand the company in new markets internationally.

In these times when the nation is still ‘over stored’ and, with so many competitors offering the same or similar goods, those retailers who will excel in the next few years will be those who have some advantage, whether it be perceived value by the consumer or operational, marketing, financial, and/or human resources strengths. It will be up to the retailers who want to excel to find a way to create this differentiation in the market place and this is best done by hiring strategic executives who can create and maintain the differentiation.

How do you find these strategic hires? Strategic hires require a major investment. In this market it can cost $100,000 to $150,000 or more to relocate an executive. In addition, you have costs related to the time it takes the executive to learn the company and become comfortable in the new role. These costs represent an investment you cannot take lightly and you definitely cannot afford to make a mistake. This means the process for identifying and recruiting candidates must not be taken lightly and also requires an investment.

Yes, in this employment market there are many executives who are desperate for employment and who are available on job boards. Although these may be top caliber executives, the important questions are: (1.) Are they the right executives for your strategic role? and, (2.) Do they have the best skills and experience as well as possess the strategic mind set? Your organization can interview dozens of these looking for the right individual. The important question is whether you are interviewing from dozens to hope for the right person or are you interviewing and selecting from a slate which has several candidates with the most appropriate skills, experiences, and personal characteristics to make sure you are getting the best strategic player for your team.

It may seem self-serving, but I strongly believe the best return on your recruiting investment for a strategic player is accomplished by engaging a search firm which specializes in serving the retail industry and which has a track record of recruiting strategic players which have proven to make a difference over both the short- and the longer-term. When you consider the cost of making a mistake, this approach is your best investment.

How do you select the right executive search firm? Based upon my years of experience in the recruitment of senior retail executives, I strongly recommend you take careful time and put in significant energy to choose a retainer based search firm to manage the recruitment of strategic hires. I recommend you interview at least four firms before you make your choice. Questions you should ask include:
-Does the search firm and the consultant who will work with you on your assignment truly understand the definition of a strategic executive and know how to determine if candidates have the experience that you require? Keep in mind, you are not asking who the search consultant knows, but, instead, what companies should be targets and why executives in those companies have the specific experience required. You are looking to guarantee a strong slate of candidates from which to select. Feel free to ask the search firm to provide you with a list of targeted organizations (along with reasons why) with their proposal to conduct the search assignment;
-Does the consultant know how to select a strategic versus a tactical executive? I recommend you have the search firm as part of its proposal prepare a position specification fully describing the position and the candidate. Instead of providing the search firm with the details of the position and the candidate, I suggest you have the search firm do it so you can assess their understanding of the position and your needs.
-Does the search firm have the resources to invest into the search assignment to determine all possible talent pools to find the best candidates? In my opinion, it is not in your best interest to have the search firm only identify the most obvious and visible executives. You require a firm which has a research group and which has databases available to identify all appropriate talent banks.
-Does the search firm have relationships with the obvious target companies to prevent them from contacting potential candidates in those target organizations? Why should you engage the search firm which recruits for the targeted organization as this means the search firm will be barred from recruiting executives from this organization to yours; and,
-Will the consultants working on your assignment have the time available to do the work? If the lead consultant is handling too many assignments at a time, it is likely he/she will not have the time to do your assignment justice.

First and foremost, you are in charge of your company’s future. You are not lucky to have a particular search firm working for you. Instead, you are smart to choose the right firm to do this strategic assignment. In my opinion, by following this process you should be able to build a team which will make a difference.