David Farkas, Senior Editor at Chain Leader writes that the role of a restaurant leader has become even more critical amid an economy so uncertain that few chains are willing to expand in the coming year. Instead, seeking traffic, they prefer to discount meals, risking their brand image.

Chain Leader recently caught up with Applebee’s franchisee Zane Tankel, whose company, Apple-Metro, continues to open restaurants despite the downturn. And why not? His 32 Applebee’s are posting nearly twice the average volume ($2.4 million) of the rest of the casual-dining system. He plans to open five more next year.

A Wharton School of Business graduate, he opened his first Applebee’s 16 years ago with partner Roy Raeburn. This year the company was named Franchisee of the Year by the franchisor.

Chain Leader invited Tankel to talk about how leadership at all levels is helping the New York-based franchise maintain its growth curve in a difficult operating environment.

Can we begin by talking about store managers and the leadership training they…

I don’t mean to interrupt you, but I gave a short speech to some franchisees a week ago in Boca Raton. I said, “We have to stop using the word ‘stores.’” A store to me is lights, shelving, four walls and sneakers. If you don’t sell the sneakers, you mark them down—again and again. On the other hand, restaurants have 1,000 moving parts, many of them perishable.

Point taken, Zane.

This is how we deploy troops. If you have great general managers, you don’t need to have one area director with… In fact, we don’t call them “directors” anymore. We call them “area leaders.” Directing is monitoring, like a jail guard, making sure everyone is doing things right. We don’t need area directors with five or six restaurants; our area leaders have seven or eight. If you have the right people at the restaurant, and you’ve trained them correctly, you don’t need supervisory personnel. As Lee Iacocca said, “Lead, follow or get out of the way.”
How does training apply to bringing an assistant general manager to the GM level?

He or she has a six-week training period moving into that position. AGMs should theoretically know what they should do, so we transition him into that position. He’s following [the GM] around as his eyes and ears. We ask him or her to go to other restaurants with the area leader and look at best practices in terms of leadership.

Speaking of area leaders…

Let me just say we returned last week from an annual retreat with area leaders and department heads that was all about leadership. This year’s theme was about total utilization of the brain. We are left-brain-driven in this industry. We have shut down the creative, right-brain side. Everything in our industry is metrics: guest counts, food, liquor, labor. It’s left-brain driven. There’s not much right-brain thinking. Yet the great thinkers, the great intellects are lateral thinkers, using both sides of their brains. Your best employees need leadership from both sides of the brain, not just do this, do that.

Why didn’t you talk about leadership in a recession?

Because it takes a right-brain thinking to work through that. I call it option-solving vs. problem-solving. I can deal with the options and get the team to come up with the best ones. Two years ago we set out a strategy for this tsunami. We had no idea of the depth and breadth of it, but we knew the economy was tanking rapidly and the industry was undergoing tremendous shifts. It is exactly the same strategy we work on today, and that’s being very aggressive when negotiating a site.

Explain that strategy.

In New York when it came to rent, the landlord’s philosophy always was, “How much pain can you take?” They knew we had to open restaurants to have to upward mobility for our managers, who otherwise would leave. So they sat back, put their feet up, lit their cigars and waited. Now it’s tuned upside down. I tell them, “The only difference between you and me is you have to rent that space. I don’t. I do not have to build a restaurant. When you are ready to talk from that vantage point…”

Read more at: Chain Leader