Contrary to perhaps popular belief, I do not consider Harvard to be in possession of the best management training. As a matter of fact I think it is the worst place to go for hands-on management training.

In my forty years of experience, whenever I had a Harvard MBA for a client, with rare exceptions, I found myself faced with an arrogant, insensitive, aloof executive. This man or woman knew the lingo of management and could impress you with concepts and work magic on financial numbers, but inevitably this person did not listen well.

Harvard MBAs were conceited. They were great consultants, could write great analytical reports, were great investment bankers who could buy for and sell a company to investors.  They could manage enormous companies where their aloofness was shielded by layers of operating executives, but as hands-on managers, those that need a human touch, where listening is necessary, they were pure disaster.

So where and how should “hands on the wheel” managers be trained?

(I am consciously avoiding the phrases “leadership development” or “executive development”, because I am tired of playing with labels when what is needed is deep theoretical analysis of what is involved in taking a company from point A to point B. If it makes more sense to you to interpret this blog entry as leadership or executive or emperor training, do it.)

You may be wondering where I noticed the best managerial training?

I believe it may come as a surprise for you.

The best ground for managerial training is a sit down, white tablecloth, one unit, personally owned…RESTAURANT.

If you can successfully manage such an enterprise, then I believe you can manage anything.

When John Chambers, the CEO of Cisco –a pretty well managed company, wouldn’t you say? — was asked where he learned to manage, he said at his Dad’s restaurant. I smiled; I agreed.

Why is a startup, white tablecloth, one unit restaurant such an enormous challenge?

You actually have to manage, because you are it. No vice presidents to tell you what to do or a Board to provide you with sound judgment. It is you and you alone who has to make decisions and live with the consequences.

You have to notice, think, value and deal with EVERY aspect of management imaginable.

First, you need a vision. What is the concept?  A restaurant is more than just a place to get and eat food. What is the theme? Bistro? Casual? Heavy formal? Modern? Ethnic?

To make that decision you have to pay attention not only to your personal passions or preferences but also to location, competition and available market.

Next, you must design the restaurant: what size, how is the flow going to be, how is the kitchen going to function? The whole production supply chain and delivery flow needs to be worked on.

After this, you must make a complementary team that can work well together or you will go bankrupt: the chef and the Maitre D, for example, must be a complementary team: front and back room managers. Not easy.

The Maitre D has to be very (I) while the Chef, if any good, should be (E) creative, yet still (P) oriented to get food out on time and with some (I) to keep the kitchen staff going and working together.  A Lone Ranger chef or a highly emotional artistic, exclusive (E), an arsonist, is a recipe for disaster (pardon the pun).

What makes a restaurant successful is consistency. A temperamental chef or turnover of chefs is a prescription for closing the shop. Over 95 percent of new restaurant openings end in failure (i.e. they close).

You also must have a product line, which is the menu. What is the right combination of new vs. legacy items (like spaghetti)?  How do you price it, how do you present it?

Next you need cost controls: how big should the dish be and what are its ingredients?  How do you make sure it’s always the same size when someone orders it? Any variation will cause you to lose money in no time. 
Now you must also consider inventory control. If you cook too much it is wasted, because a prepared dish can’t be reused. However if you produce too little, you run out of food, you will have dissatisfied customers.

Next, you need to control pilferage (i.e. stealing on the part of the staff).  Also to be considered are the suppliers who may try, for example, to put the best tomatoes on the top and the bad ones in the bottom of the delivery box.

An accountant once gave me a list of 108 different ways people steal in a restaurant. This list gets periodically updated and expanded.

Next, you have to worry about the attitude of the waiters. Do they bring their problems from home to work? You also must think about whether it is necessary to have specialized staff or not (one takes orders, another serves and another cleans the table).

And how do you remunerate?  Does each waiter/staff member collect his/her own tips, or are the tips pooled and shared?

I have found that running a restaurant is the most difficult entrepreneurial job. Starting a restaurant is a nightmare. Any of the above factors can and probably will go wrong –and they are a very small sample of what it takes to manage a restaurant. I’ll bet Murphy of Murphy’s law had a restaurant at some point.

Eating out in an expensive sit down restaurant is more than feeding yourself. It is an experience and any of the five senses may be involved at any point. You may or may not like the décor and the presentation of the food.  You might find the place too hot or too cold, the chairs too comfortable or really uncomfortable. How about the smell and the piped music? How about the lighting?  Is the waiter or waitress too attractive? The spouse might object going there.  But what if the waiter or waitress is particularly unattractive?  It might put you off.

The restaurant business is, as you can see, an endless amount of details where details count. Each and all. If the customer is unhappy there is a multiplier effect. They hardly ever eat alone. So if one does not like coming to your restaurant, at least three more will not come.  And it is painful to stand at the door of an empty restaurant hoping, praying that someone will come in. (Just watch Gordon Ramsey’s kitchen disasters to see how painful!)

To me, if you can own and manage a restaurant, you can manage anything.


Dr. Ichak Kalderon Adizes