January 2012 Archives

Pepsi Beverages (Pepsi), formerly known as Pepsi Bottling Group, has agreed to pay $3.13 million and provide job offers and training to resolve a charge of race discrimination filed in the Minneapolis Area Office of the U.S. Equal Employment Opportunity Commission (EEOC). The monetary settlement will primarily be divided among black applicants for positions at Pepsi, with a portion of the sum being allocated for the administration of the claims process. Based on the investigation, the EEOC found reasonable cause to believe that the criminal background check policy formerly used by Pepsi discriminated against African Americans in violation of Title VII of the Civil Rights Act of 1964.

The EEOC's investigation revealed that more than 300 African Americans were adversely affected when Pepsi applied a criminal background check policy that disproportionately excluded black applicants from permanent employment. Under Pepsi's former policy, job applicants who had been arrested pending prosecution were not hired for a permanent job even if they had never been convicted of any offense.

Pepsi's former policy also denied employment to applicants from employment who had been arrested or convicted of certain minor offenses. The use of arrest and conviction records to deny employment can be illegal under Title VII of the Civil Rights Act of 1964, when it is not relevant for the job, because it can limit the employment opportunities of applicants or workers based on their race or ethnicity.

"The EEOC has long standing guidance and policy statements on the use of arrest and conviction records in employment," said EEOC Chair Jacqueline A. Berrien. "I commend Pepsi's willingness to re-examine its policy and modify it to ensure that unwarranted roadblocks to employment are removed."

During the course of the EEOC's investigation, Pepsi adopted a new criminal background check policy. In addition to the monetary relief, Pepsi will offer employment opportunities to victims of the former criminal background check policy who still want jobs at Pepsi and are qualified for the jobs for which they apply. The company will supply the EEOC with regular reports on its hiring practices under its new criminal background check policy. Pepsi will conduct Title VII training for its hiring personnel and all of its managers.

"When employers contemplate instituting a background check policy, the EEOC recommends that they take into consideration the nature and gravity of the offense, the time that has passed since the conviction and/or completion of the sentence, and the nature of the job sought in order to be sure that the exclusion is important for the particular position. Such exclusions can create an adverse impact based on race in violation of Title VII," said Julie Schmid, Acting Director of the EEOC's Minneapolis Area Office. "We hope that employers with unnecessarily broad criminal background check policies take note of this agreement and reassess their policies to ensure compliance with Title VII."

"We obtained significant financial relief for a large number of victims of discrimination, got them job opportunities that they were previously denied, and eradicated an unlawful barrier for future applicants," said EEOC Chicago District Director John Rowe. "We are pleased that Pepsi chose to work with us to reach this conciliation agreement and that through our joint efforts, we have been able to bring about real change at Pepsi without resorting to litigation."

The EEOC enforces federal laws against employment discrimination. The EEOC issued its first written policy guidance regarding the use of arrest and conviction records in employment in the 1980s. The Commission also considered this issue in 2008 and held a meeting on the use of arrest and conviction records in employment last summer. The EEOC is a member of the federal interagency Reentry Council, a Cabinet-level interagency group convened to examine all aspects of reentry of individuals with criminal records.

The Minneapolis Area Office is part of the EEOC's Chicago District. The Chicago District is responsible for investigating charges of discrimination in Minnesota, Illinois, Wisconsin, Iowa and North and South Dakota. Further information is available at www.eeoc.gov.

QSRs and hotels have embraced the notion of customer feedback. We’re inundated by surveys, comment cards, and “tell us how we did” prompts.

The interesting thing is that all of these methods of gathering feedback produce structured data that can be (unintentionally or not) manipulated by the business. For example;

  • “Please tell us how good your food was” – Manipulative because it positions the food as being “good”
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  • “What other restaurants would you compare us to? Please choose” – The comparison restaurants may or may not be similar in concept or food and beverage offerings.  The business is forcing the survey respondent to  limit their answer to a pre-selected set of answers.  This type of question (multiple choice) is inherently manipulative for a survey response.
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  • “Rate your experience” – This question limits what a respondent can discuss.  They may have 20 great details they wish to share, but the one negative detail will cloud their overall perception and therefore skew their score.  This is the fundamental problem with the “stars” rating system used by so many review sites.

 

By limiting the methods of response, cleverly wording questions, or simply using different types of questions, a business can “force” the responses of their customers.  Not all of this type of manipulation is bad however.  A business may have a known problem area they wish to address and can use a survey to ask specific questions about it.  They may wish to use the information to measure or track their employee performance and use quantitative scales to do so.  These are tried and tested uses of surveys that can help a business optimize their operations.

Approaches like these are valuable tools, but the one key element they struggle with is the ability to uncover what’s actually on their customer’s minds.  You may be asking about your service when your customers are really more interested in telling you about your food and beverages.  In order to best understand what a customer really wants you to know, we need to open up our options of receiving and understanding feedback.

Think about it from this example.  Which of the two methods of feedback is more valuable?  Consider that they are both commenting about the same topic, “service”, and that it is the same customer providing both methods of feedback.

  • A traditional survey response rating “service” as a 1 out of a possible 10 points.
  • A Facebook comment from that same customer that says “The service was fine, but the waiter spilled a water glass on my shoe!  At least they apologized about it, but c’mon!”

 

The Facebook comment explains why the customer was unhappy with thee service, but it also informs you the service the customer received appeared to be okay. These types of nuances simply cannot be ascertained from a traditional survey question and can be a critical to your evaluation of a disgruntled customer.

Over the past month alone, we have gathered and analyzed over a million customer comments posted on sites like Facebook, Yelp, TripAdvisor, and Twitter for our clients.  An amazing amount of feedback that continues to see double digit growth month over month.  These are unprompted, top-of-mind comments directly from customers who ate at your restaurant, stayed at your hotel, or shopped at your store.   Just gathering and reading this feedback alone is valuable, but we take it one step further and analyze it down to individual insights that can be used to optimize your operations.

While traditional surveys have been the benchmark for guest satisfaction for many years, the smart businesses are starting to realize that using unprompted customer feedback gathered from Social Media sources can be at least, if not more valuable to their business.

Mobile Marketing 101

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I have been following this company for a couple of years now. Everytime I see them they are getting better at what they do. Not only can they provide fully integrated mobile solutions and text messaging campaigns, but they have alligned themselves with a data company that will allow them to be able to marketing programs that hone in our YOUR specific target audience.

By being able to create customized Mobile URLs that speak to differentiated market segments and advertising to them differently we can gain you greater market share. They can also provide you with all the back end analytics that you need to make sure the program is a success.

 

We had the opportunity to travel through the US IN November and December and got into a lot of restaurants. We saw good things, and good people, but also some operational issues that have the result of leaving dollars on the table—revenue enhancement and expense related. We have seen these issues often enough throughout 2010 and 2011 to mention the commonalities.

None of this is brain surgery; we’ve all been talking and working on these issues forever. But execution challenges exist, and easily amounts to that magical point of same store sales gain or multiple pennies/share earnings. Where appropriate, we’ve ascribed this to an operator or restaurant segment sub-set.

Revenue related

Lack of suggestive upselling or actual down selling (QSR):  it is a rare occasion where we are upsold in QSR and fast casual settings. In some situations, the sale is actually downsold, e.g., “will that be the sandwich?” even by store management. My hope in 2012 is that every customer can be upsold once, face to face.   In QSR situations, there must be a comeback situation for hourly staff for where the answer is “no combo”. What’s the next default?

Overkill with POS displays (QSR): via a QSR survey recently, we counted the range of the number of printed in store visual communications pointed at the customer. The high was 87 distinctive signs (Carl’) and the low seven (Pizza Hut, with almost all price merchandizing and only two specific product related displays).  Some drive thru windows and chutes were a veritable forest of signs. Assuming 45 seconds at the drive thru chute and panel, how much can be seen? Two many displays seem to be counterproductive and split the product mix.

Dessert size, portions and price prohibitive (Casual dining): We confess that we have a taste for chocolate, and often have been staggered by the size, calories and price ($6-8) for a post meal dessert item at the casual diners. To our memory, both Chili’s and PF Chang’s (PFCB) are working with smaller bite sized “tastes”, but have not reported on menu mix hit rates for these items. That might be illustrative for the industry. 

Expense related

Staffing standards (casual dining) in general we see way too heavy staffing from 1100a to 1200 noon, and from 500-600P, especially in the Darden concepts (DRI) and at Chili’s (EAT), but understaffed after 900p (DINE-Applebee’s), especially among wait staff. Perfecting matching labor hours, customers and restaurant needs will never be possible, and hourly employees do want hours, of course. Since the average check should go up in later hours, perhaps both labor hour and sales/man-hour standards and calculations are required.

Closely related to this point is new unit opening labor staffing (both QSR and Casual Dining): when a new unit opens, we are justifiably proud of it and want the opening to go flawlessly and get new employees trained. But our observation is that the necessary staffing up period goes on too long after opening, making it then unrealistic for both guests and employees, for when the eventual, sharp ramp back to standard staffing levels occur. We suggest that the ramp up and ramp down be more graduated and less “sharp”. 

Out of whack air conditioning: (electricity/air conditioning: QSR and casual dining) with Starbucks and the coffee houses as a strategic exception (colder=intent to consume hot beverages goes up), we see cooling temperatures way out of whack, particularly after sundown, when it does cool off. This could take CAPEX to fix if not separate units for the FOH/BOH.

Too much product pre-cooking (QSR): The goal is hot food hot and cold food cold. With the growth of big burgers, more complex menus and 24 hour breakfast operations, the back of house is more challenging. Product is warmest when first cooked, and has a finite holding time in bins. Jack in the Box (JACK) does a nice job of delivering hot product, but am noticing more cooler burgers at McDonalds (MCD) the last year.

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This page is an archive of entries from January 2012 listed from newest to oldest.

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