I. What is Productivity?

*Productivity is the average number of units sold, per hour worked for that day.

*Hours worked includes any hours that any punched in employee spends prepping food, serving customers, performing cleaning tasks, completing daily paperwork, and any other task required for smooth operation of the restaurant.

II. Why is Productivity so Important?

*Productivity goals are critical for efficient operations and controlling labor costs. This is best obtained by training your staff to be efficient and well organized.

*A productivity below 8.0 could indicate that employees are bored, unchallenged, or inefficient. This encourages socialization and poor work habits, which can adversely affect customer service.

*An example of how productivity is calculated.

402 (total units) / 43 (hrs worked) = 9.3 productivity.

III. Why speed is important for productivity

*Faster service increases the number of units produced per hour

*A well trained employee can make a footlong sandwich in 120 seconds (2 mins) from order to ringing up.

*Schedule so that customers can pay within 5 mins of walking through the door.

IV. Scheduling has a direct effect on productivity

*Staff up for lunch and peak periods, and overlap shifts.

*Aim for a productivity range of 8 to 12 per week. Ideal is around 9. Good productivity also allows time for food preparation, cleaning, and other tasks related to the operation of the restaurant.

*Almost every restaurant (except drive-thru) is designed to run with 1 person during slowest periods.

* A useful strategy is to use more short shifts instead of a few long shifts. This keeps employees “fresh” and allows for more flexibility on altering those shifts if it is busier or slower than expected. (Cutting or adding time) Ex. Instead of two 8 hour shifts schedule two 5 hour shifts and one six hour shift.

*Stagger when employees arrive for their shifts. If the schedule shows that between 12:00 and 1:00 you will sell 25 sandwiches, it may be that they are actually sold closer to 12:30 and 1:00, meaning that additional employees may not need to start work at 12:00, but may start at 12:30 instead.

*Open with one person. If you open at 7:00 and your lunch rush goes from 11:30-1:30, schedule your opener to work alone with your second person to begin at 11:00-11:15 rather than having two openers, then stagger your additional lunch help in as the numbers indicate. If you need a second person earlier to get stocking or administrative work done, have your third person come around the beginning of the rush, such as 11:30 in this example.

*An experienced and well prepared employee can handle more units per hour, compared to a newer employee that may not yet be efficient and fast. Consider the experience level of your employees when preparing a schedule so as to not sacrifice customer service or overwhelm a less efficient employee.

V. Be prepared for the rush: Scheduling and efficient preparation relates to good service. Thru-Put is productivity’s best friend.

1. Start the day with an organized restaurant. Train your employees to properly prepare for the busier times so that customers can receive quick service. Do all meal prep in advance, keep supplies up front full and up to par levels, clean and do paperwork during slower hours while using efficient closing or opening procedures.

A higher productivity and more efficient thru-put can be achieved through proper meal preparation. Before each peak period, or meal, your staff should:

-Prepare enough meats and veggies to get through the peak period

-Fully stock napkins, deli paper, gloves, subwrap, coin, straws, cups, and anything else needed during the rush.

-Fully stock the reach-in cooler so that backup meats and veggies are quickly accessible.

Do anything needed to make your assembly line the easiest to operate and be quick and efficient when the rush is going on.

2. Staff up. Schedule generously during your busiest times. Customers want to get in and out quickly. You may be able to attain a very high productivity scheduling one or two people during lunch, but customers do not want to wait that extra 10 minutes so that you can maximize productivity. Schedule so that you can build a reputation for quick service during your busy times and it will carry through to other parts of the day.

3. Train for speed. Consistently motivate your employees to be as quick as possible. Periodically time them and challenge them to be able to make a sandwich in 60 seconds (from the time that bread is cut

to the wrapped product). Create excitement with this and encourage competition amoung your team members and other stores in your company. Remember: quick does not mean sloppy! Although you want them to be fast, you do not want customer service to deteriorate at the same time.

4. Put the best employees in their best positions for optimum efficiency. If someone is really sloppy at one position (messy veggies), or is slow at that position, place them in a position where they are quicker and more successful at producing a desirable result for the customer.

Example: The messy or slow veggie person may be a really good upseller, or may have an outgoing and pleasant demeanor with customers. They may be best on the register or possibly greeting

5. Have everyone practice “one up, one down”. This method simply means have each employee on the assembly line assist other employees on the line that fall behind. A well functioning front line should move quickly, and flow at a steady rate without pile-ups or hesitations.

Example #1: The greeter gets an order for 4 footlongs and the veggie person just finished wrapping the pervious customer’s sandwich. The next employee on the assembly line (veggie person) would go assist the greeter with bread, meats, or cheese placement on the larger order to keep production moving quickly and flowing smoothly.

Example #2: The same customer with 4 footlongs moves down the line with their sandwiches for the addition of veggies. The third sandwich in line is toasted and the veggie person is struggling to finish the second one to get to the toasted sandwich. In this situation the greeter or “meat/bread person” would move over and start the veggies for the toasted sandwich until the other person is able to take over to ensure that the line keeps up with flow of completed sandwiches, and so that the toasted sub does not sit on the line and get cold and unappetizing.

6. Eliminate “Idle Hand time”. Idle hand time is simply when an employee is idle and waiting for a sandwich to come down the line. Some common examples of idle hand time would be:

- the veggie person standing there waiting for the greeter to put on meat and cheese,

-standing there waiting for the toaster or microwave to finish.

-The register person standing there waiting for the sandwich to come down the line. That person could be using extra time between ringing sandwiches to wipe down things in the lobby, grab replacement meats or veggies for the people on the line, or quickly taking any dishes in the lobby or behind the line to the sink area. This person should also always be moving.

In other words, eliminating idle hand time means everyone’s hands should be doing something to assist or quicken the pace of the assembly line at all times while the rush is going on.

VI. Now down to the Math: What is Labor percent?

*Labor percent is a calculation based on the percentage of net sales that can be attributed to the cost of labor hours. Labor cost (total weekly wages) / Net Sales = Labor percent. When this percentage is added to the food cost percentage, the resulting number should fall in the range of 50% - 55%.

*Cost of labor / net sales = labor percentage

*For one hour: $7.25 (wage for one person) / $20.00 (4 units sold at $5 a piece) = 36.3% labor cost

Productivity Net Sales Labor %12 $60 12.1%11 $55 13.2%10 $50 14.5%9 $45 16.1%8 $40 18.1%7 $35 20.7%6 $30 24.2%5 $25 29.0%4 $20 36.3%

Looking at the example of this chart, if your restaurant operates at a productivity of 5 instead of 10, labor will be an extra 14.5%, which comes directly off the bottom line. For a restaurant of $6,500 weekly sales, that is an extra $942.50 a week, or $49,010 a year. This is why establishing effective and efficient staff so that productivity can be maximized is so important to the success of your restaurant.

VII. How should we be analyzing labor percent? : When the percentage gets too high

1. Are you over-scheduling during your slower times? Only 2 hrs a day of over-scheduling at $7.25 an hour for 365 days a year equals $5,292.50 lost off the bottom line.

2. Management should be the most, or one of the most efficient members of the staff, and understand how to maximize efficiency of each shift. Is the manager spending enough time on the front line to reduce employee hours scheduled?

3. Is high employee turnover causing the need to excessive training hours?

4. Are employees poorly organized, inefficient, or poorly trained?

VIII. Productivity and Motivation

*Motivation in a work setting is the process by which behavior is mobilized and sustained in the interest of achieving goals. It is the complex force starting and keeping a person at work in an organization, and moves that person to action. When an individual is motivated, he feels energized or inspired to act, whereas an unmotivated person feels no drive to do so.

*A productive staff is also a well motivated team that works effectively and efficiently together.

*A well motivated team is created through a positive leadership and good motivational techniques.

*Perhaps one of the most effective ways of motivating a team is to ensure that they understand and appreciate the aims of an organization and are supported by their managers in working towards the achievement of those aims. There is a range of motivational techniques that can be used to improve productivity, reduce workplace stress and increase self-confidence.

*Negative motivational techniques- Some managers believe that they can achieve results from their teams by shouting at them, talking down to them, or by threatening them with disciplinary action. However, although this fear factor can produce results, the effects will probably be much more short-term and will mean that staff is not focused on achieving business objectives but rather on simply keeping their jobs.

*Positive motivational Techniques:

*Encouraging healthy competition.

*TrainingPeople can be taught to become more motivated by showing them how to deconstruct tasks and challenges, and how to feel less intimidated by their job roles. Demonstrating to them how to cope in the workplace can lead directly to improved motivation.

*Enhanced communicationCommunication does not only mean talking to your team but also listening to them. It is important to ensure their understanding of company objectives and their individual job roles but it is equally important to show them the importance of their feedback to the achievement of targets and standards.

*Targets, rewards and incentivesIt is generally accepted that having targets to work towards, as long as they are realistic, is one of the most effective ways of improving performance. Hitting targets improves morale and self-confidence but remember that those who consistently underachieve will end up feeling demotivated.

Target achievement can be rewarded not only with financial incentives but perhaps with the offer of increased responsibility or even promotion. Different people are motivated by different things so it is important to make sure that you offer the right incentives to the right member of the team.

Motivating a team is always easier if you fully understand that they may not necessarily be motivated by the same things as you. The most effective teams are those that feel valued and supported but also feel that they are progressing and developing through the completion of challenging tasks. If a team understands company objectives, they are much more likely to want to work harder towards their achievement. Also, most people tend to respond well to being given the opportunity to make decisions

and take on additional responsibilities. Whatever motivational techniques work the best, it is always important to ensure that your team feels it is making a valuable and positive contribution.