Does It Have To Be All About The Money?


Recently I was having a conversation with my son who just happens to be a server.  He’s been serving for 3 or 4 years and has experienced decent success (enough to live on his own, pay his bills and enjoy a few beers with his friends now and then).  Because I have a passion for customer service and for my son’s success, I was interested in his perspective on the job and what motivates him to provide great customer service.  I’m certain he represents the vast majority of servers when he tells me, “Dad, it’s all about the money”!  


I have a theory about this mentality that I am determined to prove.  Making it “all about the money” prevents us from maximizing our ability to make money.  I believe this is true in every field of endeavor and especially in the customer service business.  


Here’s today’s reality.  We hire kids to provide service to our customers.  They receive tips based on the quality of the experience.  Unfortunately it’s human nature to predetermine who is capable of tipping big and who is not.  Consciously or unconsciously our servers get more enthused about serving 4 gentlemen wearing ties than they do serving 4 college kids in sneakers and t-shirts.  Much to my dismay this was validated by my son.  I guess if it’s “all about the money” I can understand this attitude.


So what if it was about something more than the money?  What if their job as a server was tied to a “higher purpose”?  When I posed this question to my son he wasn’t buying it.  He couldn’t get beyond the money.  Don’t get me wrong he could see my point of view but he is convinced I wouldn’t be able to sell a group of servers on this higher purpose concept.  I’m convinced I can.


So, what do I mean by higher purpose?  Of course there are different levels.  When you work with a higher purpose the work you do is meaningful.  You are inspired to exceed someone’s expectations just because it’s the right thing to do.  When you work with a higher purpose you are not motivated you are inspired.  Your drive comes from within.  I’m sure this sounds idealistic, but I believe it’s the key to a brand’s success. 


The mantra forever in the restaurant business has been, “Let’s have fun and make some money”!  If I’ve heard that expression once, I’ve heard it a thousand times.  To this day that expression makes me cringe.  It reinforces the mentality that money is the only thing. 


Here’s the challenge... This mentally is ingrained in the restaurant business.  While few have gone out of business because of it, I believe in many have failed to maximize their potential.  


How do we get (in many cases) a bunch of college kids some of whom have a higher purpose beyond the restaurant business to approach their serving with this mentality.  A tough assignment without a doubt.  The issue is most of our servers have a difficult time seeing past their shift.  Their mentality is how much money am I going to make in this section tonight.  For many reasons it’s difficult for them to see beyond that.  Even though the typical server isn’t in it for the long term, certainly they are in it for more than one shift!  Somehow we have to convince them that a higher purpose mentality will make them more money during their time with us whether that’s six weeks, six months or 6 years.  


Realizing what I’m about to say is idealistic, allow me to suggest the following scenario...


The manager brings her team of servers together and announces:


  “From this moment forward we are going stop making what we do everyday about the money.  Instead we are going to shift our mentality to make what we do all about the customer.  We are not going to talk about the money, we aren’t going to complain about not making good tips, we are not going think about the section we are assigned.  Instead we are going place our entire focus on doing all the little things that customers appreciate.  We aren’t going to put blinders on and worry just about our section but we are going to see the whole restaurant as our responsibility.  We are going to work on making every customer happy regardless of what section they are in.  In essence we are going to make the money a secondary consideration.”


 Once the manager has established this vision she then asks the group to discuss the advantages and disadvantages of running the business this way.  This is a critical component.  We cannot “command and control” our teams into doing this.  They must buy in.  They must sell themselves.  Chances are if the stage is set properly and the manager allows the conversation to flow, the sell-through will take care of itself.  Once the vision has been established and the manager is confident that the team has bought in, next is the hard part.  Making sure this cultural shift gets traction every day in the restaurant.  


Getting traction requires one-on-one follow up.  The manager has to rearrange her time so that she can have quality, uninterrupted time with each member of the team.  During those one-on-ones the manager does not preach the vision.  Instead she asks a series of open-ended questions.  The objective is to gauge the level of buy-in and to continue to allow the individual team members to sell themselves on the value of this higher purpose approach.  


The key after that is to stay with it.  The natural tendency in any change effort is to do it for a while then gradually slip back into the way it used to be.  This requires what I refer to as “creative reinforcement”.   Remember we can’t command and control this.  We have to make it fun and inspirational.  It can’t be systematized.  We have to allow the team to come up their own ideas on how to keep it flowing.  We have to keep the focus on the intrinsic rewards.  When we do this I’m convinced the money will flow for everyone.  


I’d love to hear your comments.  Can we change this mentality?  Does what I’m saying make sense or is this just “pie in the sky idealism”?  Let me know what you are thinking!  

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  • Eric - Love this topic and appreciate the conversation.

     My most recent experience with individual tips was in the country club business and it was untenable.  Teamwork was non-existent and service was just okay.  There were servers who had been there since Nam and they knew how to work the system to get tables with the members that tipped the best.  It was all about "their money".  You just can't give great service in silos.  It gets really messy in the CC biz because the servers who work Ala Carte also work banquets which is another ball of wax.

     The sense of entitlement amongst the tenured servers was ridiculous and of course it was never easy for new people to break in.  What a cultural cluster.  

    Interestingly, the competing CC in town doesn't do tips at all. They pay their servers an hourly rate and according to several people who have worked there in the past, service is incredible.

     Not sure you can make that model work in the restaurant business however I think it's interesting to compare these two models in the CC business.

     The other collateral damage in the individual tip environment has to do with the managers (as you know).  If a manager gives one of the entitled servers less tables one night than they are used to getting it's like the manager had taken away their first born.  The entitled server cops a "tude" and the air gets thick in the dining room which can be felt by the members.  The more I think about this individual tip situation the less it makes sense.  

    Your #1 reason companies don't adopt a pooled tip system is right on.  The "safe bet" is not to change.  If you buy into the "higher purpose theory" we don't want those "It's all about the money" people.  We want individuals who understand that customer service is a team sport and they want to be part of an awesome team.  A different hiring profile that's for sure.  

    Great point about smoothing out the income for servers. It also eases the tension between manager and server which is omnipresent in the individual tip environment.

    Most of my experience has been with individual tips.  In many states because of minimum wage laws pooling tips has to be voluntary (in Kentucky for sure).  Not sure how to get around that unless we pay servers non-tipped minimum wage.  That would be difficult to justify on the ole P&L.  Probably impossible.  I would like to keep this conversation going and I really want to get some others to weigh in.  Thanks again Eric for the stimulating conversation.  Very cool and fun...

  • I'm really not sure why most restaurants do the individual tip approach, but I would guess it's a combination of:


    1. If 95% of the other restaurants do it that way, then the safe bet is to do as the others do.

    2. Servers may be uneasy about adopting an unfamiliar system.

    3. Perceived difficulty of retaining the top performers.

    4. Fear that pooled tips will attract and retain lazy servers.

    5. A sense that it would be difficult to genuinely reward high performers.


    I also believe that the pooled tip system is just healthy for servers in general because it smooths out their income over time. Rather than the volatility of getting $70 in tips one night and $250 in tips another night (depending on how many tables they are sat with), they can get a steadier flow of $120-$200 every night.


    I've just never understood companies in general who talk all day about teamwork but align incentives to encourage internal competition.


    A similar example is a sales team that preaches teamwork but where a salesperson is only rewarded for selling to their own leads. If you want to incentivize salespeople to focus on their own leads that may be fine, but don't waste everyone's time with the "teamwork" speech because it is fundamentally opposed to the way the sales department is structured.


    Unfortunately I have no idea how to prove this without opening up our own restaurants. I'd welcome readers who believe in the individual-tips system to comment, as there are certainly merits to it that I am missing. One correlation seems to be that high-end restaurants are more likely to do pooled tips, while lower end ones are almost certain to do individual tipping. Does this generalization sound about right to you?


    What are your experiences with the two tipping models?

  • WOW Eric, thanks for your insight.  I am totally in agreement regarding the reference to "kids".  I would rather have a fresh face with the right attitude then someone who comes with an old school mentality etched in their psyche.  It would be fascinating to study the two different scenarios in depth.  The HP restaurant had to have great morale and like you said a bad seed just won't last long. I have no doubt the HP restaurant scored higher on Zagat and I'm certain that has to translate to bottom line profit.  Why in your opinion don't more restaurant owners adopt the pooled tip approach?  I get your point about starting with a "clean slate" but even so, there aren't many that I know of that are thinking that way.  I'd love to be able to prove that a pooled tip environment is better for the bottom line.  Do you have any thoughts on how we might prove that?  I think it's time to shake things up in the industry.  I'd love to hear more from you!  Have a great weekend.  

    Enthusiastically Yours,



  • It does make sense, and I do believe it is possible to execute. I've worked in front of house at an "all about the money" (AATM) restaurant and a "higher purpose" (HP) restaurant.


    The AATM restaurant had the classic tip structure where each server gets what he/she earned from their tables, and they will tip out the bussers and food runners.


    The HP restaurant did pooled tips, where all servers got an equal amount (assuming they all worked the same amount of time). 


    The AATM restaurant talked at great length about teamwork (insert cliche here) at great futility. This restaurant rated around 2.5-3 stars on Yelp, and was widely considered to be mediocre.


    The HP restaurant was one of the few business where I've ever observed true teamwork. This restaurant was consistently in the top 5 of all Yelp restaurants, #1 in Zagat for the Bay Area, etc.


    Some argue that the pooled tips allows lazy/selfish people to hang around and reap the benefits, while failing to reward the top performers. This is only a problem if you allow lazy/selfish people to continue to be part of the team. I firmly believe that average tip total, customer satisfaction, and consistency of service will improve under the pooled tips system. This will be a virtuous cycle that will help recruit and retain better servers. If you have a "hotshot" server who complains that pooled tips will hurt their bottom line, they likely are the kind of server that is selfish and regularly screws over the rest of the staff anyways. Let them go.


    The best way to implement a HP culture is when a restaurant opens. I would imagine that making a major change to an existing, set-in-their-ways staff will be a major challenge.


    I don't necessarily believe that there is a correlation between "kids" and only caring about the money. In my experience the servers that are least likely to buy into a company culture are the ones who have served at 12 restaurants in the last 6 years, and do everything THEIR way and disregard the opinions/aspirations of the team and management. I think "kids" are often the idealist types, and with a cleaner slate are more likely to adopt a compelling culture.


    I would hire someone with a great attitude and learning capacity with 1 year experience over someone who has worked at 10 restaurants over 5 years any day.


    Great post!


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