Setting the Table: The Transforming Power of Hospitality in Business

by Danny Meyer

True, a restaurant has all kinds of moving parts that make it particularly challenging. In order to succeed, you need to apply—simultaneously—exceptional skills in selecting real estate, negotiating, hiring, training, motivating, purchasing, budgeting, designing, manufacturing, cooking, tasting, pricing, selling, servicing, marketing, and hosting.

You may think, as I once did, that I’m primarily in the business of serving good food. Actually, though, food is secondary to something that matters even more. In the end, what’s most meaningful is creating positive, uplifting outcomes for human experiences and human relationships. Business, like life, is all about how you make people feel. It’s that simple, and it’s that hard.

I’VE LEARNED MORE OF what I know about life from people than from books, and I’ve learned much of what I know about people from the food they eat.

For us, the ongoing challenge has been to combine the best elements of fine dining with accessibility—in other words, with open arms.

Hospitality is the foundation of my business philosophy. Virtually nothing else is as important as how one is made to feel in any business transaction. Hospitality exists when you believe the other person is on your side. The converse is just as true. Hospitality is present when something happens for you. It is absent when something happens to you. Those two simple prepositions—for and to—express it all.

Learning to manage volunteers—to whom, absent a paycheck, ideas and ideals were the only currency—taught me to view all employees essentially as volunteers. Today, even with compensation as a motivator, I know that anyone who works for my company chooses to do so because of what we stand for. I believe that anyone who is qualified for a job in our company is also qualified for many other jobs at the same pay scale. It’s up to us to provide solid reasons for our employees to want to work for us, over and beyond their compensation.

We traveled west to the coastal village of Arcachon, where I learned to slurp down briny blue-fleshed oysters along with dried sausage, brown bread, and butter.

While we weren’t giving away Château d’Yquem, we did offer an assortment of world-class sweet wines like Château Raymond-Lafon, Château Guiraud, Moscato d’Asti, Malvasia delle Lipari, and Verduzzo di Cialla. Our most popular dessert wine was from Tuscany Vin Santo—an amber-colored Madeira-like wine into which we’d encourage guests to dunk almond biscotti. The Italian tradition of biscotto bagno (“biscuit bath”) was new to most of our guests in 1985, but it was an after-dinner delight I had enjoyed learning about while working as a tour guide in Rome back in 1978.

Service is the technical delivery of a product. Hospitality is how the delivery of that product makes its recipient feel. Service is a monologue—we decide how we want to do things and set our own standards for service. Hospitality, on the other hand, is a dialogue. To be on a guest’s side requires listening to that person with every sense, and following up with a thoughtful, gracious, appropriate response. It takes both great service and great hospitality to rise to the top.

But hospitality, which most distinguishes our restaurants—and ultimately any business—is the sum of all the thoughtful, caring, gracious things our staff does to make you feel we are on your side when you are dining with us.

I had already learned that the trick to delivering superior hospitality was to hire geniune, happy, optimistic people.

“Here, come look,” he said. He pointed out dozens of tiny aquatic insects hatching on the rock. This told him precisely which fly to tie because, as he explained, the trout would only bite on an artificial fly that resembled what was actually hatching. The guide then put the stone back exactly where he had found it. I was intrigued. There was a world of information under that rock, if only one knew or cared enough to look for it.

Shared ownership develops when guests talk about a restaurant as if it’s theirs. They can’t wait to share it with friends, and what they’re really sharing, beyond the culinary experience, is the experience of feeling important and loved. That sense of affiliation builds trust and a sense of being accepted and appreciated, invariably leading to repeat business, a necessity for any company’s long-term survival.

The best way to do this is to first gather as much information as I can about our guests. I call this collecting dots. In fact, I urge our managers to ABCD—always be collecting dots. Dots are information. The more information you collect, the more frequently you can make meaningful connections that can make other people feel good and give you an edge in business. Using whatever information I’ve collected to gather guests together in a spirit of shared experience is what I call connecting the dots. If I don’t turn over the rocks, I won’t see the dots. If I don’t collect the dots, I can’t connect the dots. If I don’t know that someone works, say, for a magazine whose managing editor I happen to know, I’ve lost a chance to make a meaningful connection that could enhance our relationship with the guest and the guest’s relationship with us. The information is there. You just have to choose to look.

I HAVE ALWAYS VIEWED excellence as a journey rather than a destination. Taking that journey demands a form of athleticism. It is the athlete’s nature to call on all resources to compete and win. I believe it’s possible to apply to business the same athletic skills I would apply on a tennis court or a baseball diamond. I see this as a combination of innate ability, focused training, and a persistent zeal to win.

ATHLETICISM!

I also use this information to bring together people from similar professions, or to connect people who I know share some common ground—whether it’s from the art world, financial services, politics, the culinary business, book publishing, journalism, advertising, or design. I call this planting like seeds in like gardens in order to extend our community.

I will throw myself into a new venture only when certain criteria are met: I am passionate about the subject matter (i.e., early American folk antiques, modern art, jazz, barbecue). I know I will derive some combination of challenge, satisfaction, and pleasure from the venture. It presents meaningful opportunities for professional growth for my colleagues and me. The new business will add something to the dialogue in a specific context, such as luxury dining (Gramercy Tavern), museum dining (The Modern, Cafe 2, and Terrace 5 at the Museum of Modern Art), Indian dining (Tabla), barbecue (Blue Smoke), or burgers and frozen custard (Shake Shack). Financial projections indicate the possibility of sufficient profit and returns on our investment to warrant the risk we’re undertaking.

Context is everything. What has guided me most as an entrepreneur is the confluence of passion and opportunity (and sometimes serendipity) that leads to the right context for the right idea at the right time in the right place and for the right value. I have never relied on or been interested in market analysis to create a new business model. I am my own test market. I am far more intuitive than analytical. If I sense an opportunity to reframe something I’m passionately interested in, I give it my absolute best shot.

I began to outline what I considered nonnegotiable about how we did business. Nothing would ever matter more to me than how we expressed hospitality to one another. (Who ever wrote the rule that the customer is always first?) And then, in descending order, our next core values would be to extend gracious hospitality to our guests, our community, our suppliers, and finally our investors. I called that set of priorities enlightened hospitality. Every decision we made from that day forward would be evaluated according to enlightened hospitality. We would define our successes as well as our failures in terms of the degree to which we had championed, first, one another and then our guests, community, suppliers, and investors.

Invest in your community. A business that understands how powerful it is to create wealth for the community stands a much higher chance of creating wealth for its own investors. I have yet to see a house lose any of its value when a garden is planted in its front yard. And each time one householder plants a garden, chances are the neighbors will follow suit.

Know Thyself: Before you go to market, know what you are selling and to whom. It’s a very rare business that can (or should) be all things to all people. Be the best you can be within a reasonably tight product focus. That will help you to improve yourself and help your customers to know how and when to buy your product.

Over the years, the most consistent compliment we’ve received and the one I am always proudest to hear, is “I love your restaurants and the food is fantastic. But what I really love is how great your people are.” The only way a company can grow, stay true to its soul, and remain consistently successful is to attract, hire, and keep great people. It’s that simple, and it’s that hard.

Theoretically, if the ideal candidate were to score 100 on a suitability test (something we have never administered), his or her potential for technical excellence would count for 49 percent, and innate emotional skills for hospitality would count for 51 percent.

People duck as a natural reflex when something is hurled at them. Similarly, the excellence reflex is a natural reaction to fix something that isn’t right, or to improve something that could be better. The excellence reflex is rooted in instinct and upbringing, and then constantly honed through awareness, caring, and practice. The overarching concern to do the right thing well is something we can’t train for. Either it’s there or it isn’t. So we need to train how to hire for it.

Optimistic warmth (genuine kindness, thoughtfulness, and a sense that the glass is always at least half full) Intelligence (not just “smarts” but rather an insatiable curiosity to learn for the sake of learning) Work ethic (a natural tendency to do something as well as it can possibly be done) Empathy (an awareness of, care for, and connection to how others feel and how your actions make others feel) Self-awareness and integrity (an understanding of what makes you tick and a natural inclination to be accountable for doing the right thing with honesty and superb judgment)

Guests may think they’re dining out to feel nourished, but I’ve always believed that an even more primary need of diners is to be nurtured.

No one can possibly be upbeat and happy all the time. But personal mastery demands that team members be aware of their moods and keep them in check. If a staff member is having personal trouble, and wakes up angry, nervous, depressed, or anxious, he or she needs to recognize and deal with the mood. It does not serve anyone’s purposes to project that mind-set into the work environment or onto one’s colleagues. We call that “skunking.”

It’s pretty easy to spot an overwhelmingly strong candidate or even an underwhelmingly weak candidate. It’s the “whelming” candidate you must avoid at all costs, because that’s the one who can and will do your organization the most long-lasting harm.

Imagine that I’m standing on the shores of Manhattan and I am required to cross the Atlantic to France. The catch is that to get there, I have only two options: I can either swim or ride there on the back of a shark. Swimming is obviously out of the question. I’ll tire, freeze, and soon drown. My only choice then, is to hop on the back of the shark and ride with exceptional care and skill, or I’m lunch. The shark, you see, is the press, and it needs to keep swimming or it dies. I can benefit from acting very carefully with that knowledge. If my riding technique is expert, the shark can be my vehicle to deliver me safely to my destination.

brilliant!

I ended the memo by quoting something my late grandfather, Irving Harris, always used to remind me. “People will say a lot of great things about your business, and a lot of nasty things as well. Just remember: you’re never as good as the best things they’ll say, and never as bad as the negative ones. Just keep centered, know what you stand for, strive for new goals, and always be decent.”

THREE HALLMARKS OF EFFECTIVE leadership are to provide a clear vision for your business so that your employees know where you’re taking them; to hold people accountable for consistent standards of excellence; and to communicate a well-defined set of cultural priorities and nonnegotiable values. Perhaps most important, true leaders hold themselves accountable for conducting business in the same manner in which they’ve asked their team to perform.

HUGE

Wherever your center lies, know it, name it, stick to it, and believe in it. Everyone who works with you will know what matters to you and will respect and appreciate your unwavering values. Your inner beliefs about business will guide you through the tough times. It’s good to be open to fresh approaches to solving problems. But, when you cede your core values to someone else, it’s time to quit.

I anticipate that outside forces, including you, will always conspire to change the table setting. Every time that happens, I’m going to move everything right back to the way it should be. And so should you! That’s the constant aspect. I’ll never recenter the saltshaker in a way that denies you your dignity. That’s the gentle aspect. But standards are standards, and I’m constantly watching every table and pushing back on every saltshaker that’s moved, because excellent performance is paramount. That’s the pressure.

Every business needs a core strategy to be what I call always on the improve, and for us it’s constant, gentle pressure.

This is one aspect of business where batting .667 isn’t a winning average. Leave any one element out, and management is far less effective. If you are constantly gentle but fail to apply pressure when needed, your business won’t grow or improve: your team will lack the drive and passion for excellence. If you exert gentle pressure but not constantly, both your staff and your guests will get a mixed message depending on what day it is, and probably won’t believe that excellence truly matters to you. If you exert constant pressure that isn’t gentle, employees may burn out, quit, or lose their graciousness—and you will probably cease to attract good employees. Leaders must identify which of the three elements (constant, gentle, or pressure) plays to their greatest natural strengths and, when necessary, they must compensate for their natural weaknesses.

ULTIMATELY, THE MOST SUCCESSFUL business is not the one that eliminates the most problems. It’s the one that becomes most expert at finding imaginative solutions to address those problems. And lasting solutions rely on giving appropriate team members a voice, as well as responsibility for making decisions.

I thought I was a pretty good communicator, but then it dawned on me: communicating has as much to do with context as it does content. That’s called setting the table. Understanding who needs to know what, when people need to know it, and why, and then presenting that information in an entirely comprehensible way is a sine qua non of great leadership.

I’m a bottom-up manager who subscribes to the concept of “servant leadership,” as articulated by the late Robert Greenleaf. He believed that organizations are at their most effective when leaders encourage collaboration, trust, foresight, listening, and empowerment. In any hierarchy, it’s clear that the ultimate boss (in my case, me) holds the most power. But a wonderful thing happens when you flip the traditional organizational chart upside down so that it looks like a V with the boss on the bottom. My job is to serve and support the next layer “above” me so that the people on that layer can then serve and support the next layer “above” them, and so on. Ultimately, our cooks, servers, reservationists, coat checkers, and dishwashers are then in the best possible position to serve our guests.

Since I believe that as our management team goes, so goes our staff, Paul Bolles-Beaven and his HR staff created a list of nine specific traits that define the mind-set and the character traits we look for when making a decision about hiring a manager. 1. Infectious Attitude

2. Self-Awareness

3. Charitable Assumption Enlightened hospitality is a philosophy that works best with optimistic, hopeful, open-minded people at the helm. It tends not to work when the leaders are skeptics who think they already have all the answers. Those people are a finished product in their own minds, and so is everyone else they work with. A charitable mind-set assumes the best in other people. Mind-sets tend to become self-fulfilling prophecies. When you assume that people’s stumbles are honest mistakes that come from a good place, you get farther with them during their victories. When you assume the worst of people, you get the worst from people.

4. Long-Term View of Success If you have a philosophy that puts employees first, guests second, community third, suppliers fourth, and investors fifth, you implicitly have a long-term perspective—at least as long as your lease. We create restaurants for the long haul, and we make decisions based on that commitment. Every time I’m faced with a decision that involves an investment of money, I analyze the potential return by asking, “Will this yield today dollars, tomorrow dollars, or never dollars?” Only the third alternative—never dollars—is unattractive to me.

5. Sense of Abundance

Though it made little apparent budgetary sense, we began participating in charity fund-raisers and offering gift certificates for dinners at Tabla as auction prizes—far more generously than ever before. It was a very effective way to target our marketing to people who tended to care about our favorite causes, and who also might take an interest in Tabla.

If you want to be busy, especially in times of scarcity and uncertainty, you cannot accept diminished standards of excellence in even one area. You do everything you possibly can afford to show your staff and guests that you care deeply about improving. That’s acting from a positive and hopeful place, rather than from fear that can ultimately be self-fulfilling. The mind-set “We’re just hanging on” perpetuates scarcity. Investing money, imagination, and hard work to create a mind-set of abundance achieves abundance.

In several of our restaurants, we go a step further. As the already-low check is dropped, each guest at the table is presented with a thank-you note as well as a gift certificate to welcome him or her back for lunch at another time. (In 2005, for example, we presented each guest with a “come back” lunch certificate for $20.05.) At this point, guests are thinking, “They’ve already offered an outstanding lunch for $20.05, and now they’re giving me a $20.05 gift certificate to return!” And return they do.

6. Trust It’s extremely difficult for a manager to motivate people if he or she tends not to trust others. Similarly, it’s extremely difficult for employees to trust or want to follow the lead of a manager who doesn’t trust them. It’s hard to do your best for an extended period of time when your primary motivation is to avoid disapproval.

7. Approving Patience and Tough Love Tough love is another term for frank, “I’m on your side” honesty. It’s saying, “I care enough about you to tell you the truth, even if the truth is tough to hear.” Patience with tough love sends a clear message to your staff that you’re on their side. We also put a premium on outward and unequivocal messages of approval. It is absolutely incumbent on managers to praise employees for good work. As I once read in Kenneth Blanchard’s One Minute Manager, it’s the managers’ job to “catch people in the act of doing things right.” I subscribe to that and take it one step further.

8. Not Feeling Threatened by Others

9. Character For our managers to become great leaders, we identify and assess a number of crucial character traits that are a subset of the five core emotional skills—optimistic warmth, intelligence, work ethic, empathy, integrity, and self-awareness—that make a “51 percenter.” Those traits include honor, discipline, consistency, clear communication, courage, wisdom, compassion, flexibility, ability to love (and be loved) humility, confidence (to possess it and to inspire it in team members), passion for the work and for excellence, and a positive self-image.