A Tale of Two Cultures: How a different mindset will lift food & beverage

By Brian Mitchell Principal, Mitchell Performance Systems | August 19, 2012

Co-authored by Evan Mitchell, Senior Consultant, Mitchell Performance Systems

** This is the first article in a series on improving revenue and profits from F&B

Hotel Food and Beverage is unquestionably a sales-based business. But can it really claim to have a sales-based culture?

In the summer of 1998 the Gillette Company was preparing to hit the button on the most expensive new product launch in FMCG history to that time. It was a product shrouded in secrecy. Through the years of its conception, design and production, what was to be the revolutionary Mach 3 razor went by the code name ER-226. It’s said that even Warren Buffett, a major Gillette shareholder, was kept in the dark.

We were consulting to the company’s sales divisions at the time and were given the task of translating consumer benefits – the product characteristics that had driven the four year design – into retailer benefits. These would provide the sales ammunition the account and category managers needed for their presentations to retailers on launch. There were clearly established strategies for Mach 3, and other supporting products in the Men’s Grooming category, aimed at ensuring immediate market penetration and brand take-off. This was orchestrated to happen in multiple ways via impulse sales, add-on sales, trade-up sales, and solution selling. Each had their own sales messages for consumers – and for retailers. Despite plenty of skepticism in the press and the market generally about the price and product complexity of Mach 3, the launch exceeded even Gillette’s optimistic expectations. Inside six months it was market leader in both North America and Europe.

The meticulous approach taken by Gillette on Mach 3 is typical of major fast moving consumer goods companies in most regions of the world. These are sales-based organizations with a strong sales culture. They recognize the need to adopt a scientific approach to the sales process. And while such sales classifications as impulse, and add-on, and trade-up, and even solution selling, have become somewhat passé in FMCG these days, that’s because they are truisms that are universally accepted, not because they have ceased to matter.

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Coming up in March 2018...

Human Resources: Value Creation

Businesses must evolve to stay competitive and this is also true of employment positions within those organizations. In the hotel industry, for example, the role that HR professionals perform continues to broaden and expand. Today, they are generally responsible for five key areas - government compliance; payroll and benefits; employee acquisition and retention; training and development; and organizational structure and culture. In this enlarged capacity, HR professionals are no longer seen as part of an administrative cost center, but rather as a member of the leadership team that creates strategic value within their organization. HR professionals help to define company policies and plans; enact and enforce systems of accountability; and utilize definable metrics to measure and justify outcomes. Of course, there are always new issues for HR professionals to address. Though seemingly safe for the moment, will the Affordable Care Act ultimately be repealed and replaced and, if so, what will the ramifications be? There are issues pertaining to Millennials in the workforce and women in leadership roles, as well as determining the appropriate use of social media within the organization. There are new onboarding processes and e-learning training platforms to evaluate, in addition to keeping abreast of political issues like the minimum wage hike movement, or the re-evaluation of overtime rules. Finally, there are genuine immigration and deportation issues that affect HR professionals, especially if they are located in Dreamer Cities, or employ a workforce that could be adversely impacted by federal government policies. The March Hotel Business Review will take a look at some of the issues, strategies and techniques that HR professionals are employing to create and sustain value in their organization.