Joining us on this week's Workstream webinar is Philip Hsia, multi-unit Jack in the Box franchisee. In this Q&A session, Philip shares with us his journey in the QSR industry and how Jack in the Box has been adapting during this trying times.
Read on for the full transcript:
Lydia: Welcome to Workstream's webinar. Today, we are joined by a multi-unit Jack in the Box franchisee Philip. Phil thanks so much for joining us. Why don't we just kick it off, maybe you can provide a little bit of background about how you got into the industry and what has changed over the last 30 years?
Philip: My name is Philip Hsia. I run seven Jack In the Boxes with my father and he was the one that got started in the industry in 1989. He's been around for 30+ years. I joined in 2012 after law school and I've been running for the last eight years with him.
Training Employees During A Pandemic
(00:41 - 02:11)
Lydia: That's amazing and I'm sure you've seen a lot of changes during that time. One of the things that Jack in the Box has done incredibly well is pushing food safety during COVID, could you chat a little bit about how that has been implemented and what your typical training processes are?
Philip: They actually are doing pretty well in the training for COVID. They were right at the beginning when COVID happened, they've already started with the supply chain to secure masks and other supplies for all the restaurants. When COVID happened, we've already had masks for all our employees through the drive-through. Once the restaurants and the dining rooms were shut down and went drive-through only, we went to Plexiglasses and they had this whole procedures. They have your standard cleaning routines and they have different colors for different situations and what you need to clean. So they actually have different codes and if you have somebody that has been exposed or if somebody in the restaurant test positive, you have this level cleaning and this is the procedure you have to do.
Coordinating Shift Work During A Pandemic
(02:12 - 03:59)
Lydia: And you're using the pod system right now to split up shifts, how's that going?
Philip: Yeah so it's different. It's an adjustment but I think for the safety of our teams, every shift stays in its own pod and they work with their same people. I think it gives our employees a lot of comfort in the sense that they're not mixing and the chance of being exposed are a lot smaller with the pod. They work with the same team and so they start getting that kind of continuity with the same team as well. Initially, they were hesitant because it's something new but now I think they're starting to like it because you always know who you're going to work with and so you're kind of accountable for each other's safety. They know the five other people on their shift and so they can have conversations and say hey you know everyone's staying safe and they can kind of hold each other accountable with masks cleaning, sanitizer, hand wash. They feel more comfortable talking to the people on their shift versus if you get moved around at different shifts or overlaps with people they may not know. And if they see them not washing their hands properly or their mask is down, they may not want to say something. But if they've been working with the same people, it's usually more comfortable to be remind each other about their masks and keep everyone safe.
Lydia: and how long are the typical shift hours?
Philip: Depending on the restaurants, they're open different times. We've had to adjust hours accordingly to drive through schedules and things like that but typically eight hours.
Hiring During A Pandemic
(04:00 - 05:22)
Lydia: Are there any aspects of hiring that have become more difficult as a result of the pandemic?
Philip: Yeah definitely. I think we used a lot of walk-in and word of mouth before Workstream and even though we still rely on all three now, I guess we say the more the merrier but a lot of the walk-ins and word of mouth has been going down and people have been moving more online. We've started getting a lot more online applications than in-person or walk-in because not too many people just want to walk in and hang out.
Lydia: There's no foot traffic you can't walk around through now.
Philip: I know everyone's in different places around the country but for Santa Clara county and in the Bay Area San Francisco, you're required to post the amount of people that can be in your restaurant at a time and it's actually one person per 150 square feet of space. Most spaces are a couple hundred square feet for the guests facing so you're maybe having three or four people at most and so when you have a line for walk-in ordering, you probably aren't gonna have someone wait in line just to drop off or pick up an application.
Furlough During A Pandemic
(05:23 - 06:04)
Lydia: Yeah, makes a lot of sense and have you had to let any people go or furlough due to COVID?
Philip: Fortunately, due to the nature of the drive-through and Jack in the Box system, we haven't had to furlough anyone. We're very fortunate in that sense because our drive-throughs have continuously going. We had to let people go due to the typical turnover of restaurants, either they quit or we let them go due to various other situations, but nothing due to COVID.
Employee Referral Program to Reduce Turnover Rates
(06:05 - 07:45)
Lydia: What is the typical turnover for your restaurants Jack in the Box? I hear the industry standard is like 130%, so high.
Philip: I think for us, it's a little better than that. I don't know how much better but I think because we do a lot of referrals and we offer a referral bonus as one of the avenues of obtaining talent, so usually through referral the turnover is a lot lower. But I would say typically, through other methods are roughly around kind of the same 100% I'm sure.
Lydia: Yeah and what is the referral bonus if you don't mind me asking?
Philip: Basically, for each avenue, we allocate the amount of money we're going to spend on how to obtain and retain people. Let's say you have the money to spend doing a certain outreach campaign, we take that money and say hey if anyone can fill these five positions then let's say we're initially going to spend on $350 on that marketing or hiring campaign, we will give $50 or $25 for each new hire you bring in, or $50 for each person you refer. We'd send that out to all our employees and then they would ask around and if we hired their referees and they stay for around three months, then the referral would get that bonus.
Conducting Phone Interviews
(07:46 - 08:27)
Lydia: Okay makes sense. Are you doing any video interviews or phone interviews? You guys have an interesting system where you have actual store level cell phones, have you been using them at all in the interview process?
Philip: We have not. We do phone interviews and so it would actually start with the managers. They would do phone interviews and then now it's just mainly from the manager to the district manager and so instead of one phone interview with the manager and then an in-person with the manager, it's now just become a phone interview with the manager and then a phone interview with the district manager.
Using Texting To Engage Employees
(08:28 - 09:29)
Lydia: Got it. Yeah and one of the things in the pre-webinar conversation, we were chatting about texting as a way for people to stay in touch, how is texting typically used?
Philip: We saw the importance of texting so we have store level cell phones so each store has their own cell phone now. If there's an incident or an issue, they can take a picture of it with the cell phone and they can start sending texts to their manager, the manager takes only one shift and then the shift leader, so the rest of the shifts we kind of rely on all the employees to use the cell phones. We use them for all sorts of situations from like incidents, if a customer has an issue and you report it, or we have a celebration and they want to take a picture and share to the rest of the stores, we have ones for communications as well.
Tracking Results of Referral Program
(09:30 - 10:36)
Lydia: That's awesome! And with the referral program and the other sort of things you're doing, how are you tracking that? Are you able to understand where the people are coming in and how is retention tied to it?
Philip: We track it through our payroll service so they're the ones that pass out the bonus and we can see who referred. We track who is referring and then how much they're getting. Typically, the new employee has to work three months before the person referring can get their bonus resulting in higher retention. So for us, typically, if you can make it past the first month, then the chances of you staying are quite high. We do our evaluation at around the three months mark for the new employee and we decide if we want to continue with this employee, then the referrer would get the bonus and then the employee would obviously keep working.
Incentivizing Employees to Upskill
(10:37 - 12:27)
Lydia: Yeah and how do you guys incentivize people to keep their training going and learn new things with Jack in the Box having such a vast menu, how do you get people to continually grow and learn new things?
Philip: I think that's one of the unique challenges of Jack in the Box because they have so many items that a lot of it contributes to the turnover where sometimes it's just so overwhelming. When you first get there and you see there's 150 menu items, and each one has their own procedure and safety accord that goes with it, a lot of times it's very overwhelming. We tried to break it down as much as we can and we usually start everyone off on cleaning just because that's something that most people know how to do regardless of where you've been. And then we ask them when they come into Jack in the Box, what kind of position they're interested in, let's say the fryer position, and then we break that down even further so you see where can someone contribute early on and then bring them in slowly. Jack in the Box has a great iPad training system that they're always pushing over their updates on and when they have new kind of strategies or videos things like that, they'll put them onto the iPad and so the employee will usually split their time. We have like a two week kind of mini course where we lead them through, they would spend time on iPad and then on a station so they can get both educational and practical experience.
Diversity in the Workplace
(12:28 - 14:50)
Lydia: Yeah, I think what's top of mind for a lot of people given what's going on in the world is how does Jack in the Box think about the importance of diversity in the workplace?
Philip: We try to just welcome everyone to apply and for diversity, we just try our best to be professional. I think that the ultimate standard is being professional and kind of treating everyone the same and so holding yourself to a certain high level standard and professionalism and not giving certain people favors or treating one group different because I think if you give one person a favor you almost have to every time. Basically, whether it's a customer interaction and you say hey I'm going to give you this one time then the next time they come back and they say how come I didn't get this. So whether it's positive or negative, we want to have our employees keep that same level of professionalism, then nobody can say like oh you were playing favorites to one person or try to harm another group and you're like this is our standard, you're professional.
Lydia: Yeah, I think equality is really important.
Philip: Yeah, I think professionalism is a little boring of a word but I think from a legal background, I tend to kind of be a little more conservative and safe and say yes I know we want to give everyone that extra service that extra bonus but for me it's hard enough to hit that professional standard. If we can consistently meet that professional standard, then I think you won't run into any issues. You may not be the favorite but you're not going to run into any negatives as well because nobody can accuse you of either one right being giving favors and versus not.
Tips on Hiring and Training Managers
(14:51 - 19:03)
Lydia: Yeah I think you make a lot of great points there. How do you guys do management hiring and looking for managers so you can train them up on and make sure they are being professionals?
Philip: We have a review processes in place. Our district managers have been with us for over 15 years and so there's a lot of trust there. Most of our managers have been with us for 10 years so fortunately the last store purchase we've made was in 2010 and we haven't had too many manager turnovers and we haven't expanded, so we haven't necessarily grown and gotten new managers. It's been a little while since we've had a new manager kind of process but I think if we were to acquire more restaurants or bring on different managers we kind of do it by committee. We usually often ask our managers and district managers what skills do you think you would need to be successful and then we take that as an assessment and then kind of overlay it to this new manager and the same with district managers. We've also talked to our shift leaders and employees of what they'd like to see in our managers and so we have like four lists of qualities and traits that each group wants to see and we kind of try to take a look and melt those together into one kind of perfect manager where everyone would be happy with and use that kind of as the standard.
Lydia: What are some of those traits that especially with the team and shift lead's level, what are the qualities they look for?
Philip: I think the biggest one is communication. We want people that can communicate well and so whether it's communicating with your team right, encouraging them, kind of making the right decisions on let's say if they did make a mistake. Not like yelling at them in front of everyone but rather, noting it and then talking to them later on privately, communicate about say hey this shift's going to be really busy, everyone get ready. Just the communication overall is our of number one trust. Obviously the team leaders need to trust that the managers and all leadership is trying to do what's best for them. So the things that we do are always aimed towards what's the best, how can I help my managers and then we tell our managers say what can you do on a daily basis to help your team and so I think that goes with communication but it's that trust knowing that their kind of job is to support you. The job of the people above you is to support you because ultimately we know that the customers and employees are the ones that are bringing all the revenue. The stuff that I'm doing on a daily basis isn't generating revenue and so if you have to really see employees in the front lines, they're the ones generating revenue so we're really there to support them and serve them right. The people in the front are kind of like the most important people and they feel that all their needs have been met, then you're gonna have more harmony.
Jack In The Box Unique Hiring Process
(19:04 - 24:10)
Lydia: Makes a lot of sense. How does your hiring process vary from your competitors? You've been with Jack in the box for a long time how do you think it varies from other QSRs?
Philip: I guess the industry standard is Chick-fil-A and so we've actually done a lot of studies into different QSRs obviously to look at competitors and what they do. One of the things that Chick-fil-A does specifically for customer service, that's always stuck with me because we've seen videos of what they do is actually play a video of a scenario for their customer service team about humanizing the customers. And they had a story of a customer who had maybe just lost a loved one or had all these different scenarios and they're coming to Chick-fil-A or Jack in the Box and then this customer service employee gives them great service. And all of a sudden, it turns around their day and so it kind of humanizes the customer because sometimes being on the other side with our employees, they see 500 people a day go through a restaurant a day if not more. And so they're seeing 100, 200 people in their shift and sometimes it starts becoming just a number like you have a lot of people and so a lot of times we train them. I always say for you, that customer may be one of 200 or one of 500 but for them you know they've only...
Lydia: One of three meals.
Philip: Exactly, one of three meals and I say when you go to another restaurant and imagine, a lot of us love food and it's something we look forward to. You go to work and then you're like okay when's lunch, I'm going to eat this for lunch. And if you happen to be fortunate for the customer to choose, hey I want to go to Jack in the Box and if you give them that great experience or at least the professional standard, then they go happy. They can enjoy that day versus if it's not something that's great or is below standard, then it's a third of a big part of the day can be ruined right just from having a bad lunch or if you order out to go drive through and you're missing an item.
Lydia: If I'm missing ketchup it's like all over. I've turned around and I've gone back for that. Yeah not that it ever happened with Jack in the Box.
Philip: I think it's a continuous learning process. They serve hundreds of people and even I try to go at least two three times a week to different restaurants, probably closer to like one restaurant a week and I order food and I get stuff and I'm just like a regular customer until the window then I'm a different person. But when you order and everything, the whole ordering process all up to the window is pretty much similar but by the time I get to the window, it's not like they can remake a new burger for me or anything like that so I still oftentimes get the same experience and that's when we'll have to communicate and kind of constantly train about those professionalism standards.
Lydia: Yeah and what is the typical length between the time you get the application and the time people actually start their first day?
Philip: Okay so we actually have a pretty quick process because we only have seven restaurants so it can move quickly up the chain. Let's say someone applies today, we get the application, the manager looks at it, they can call them back and have this conversation with the employee. Typically they ask questions - when would you like to start, things like that, and if it's okay I want to start as soon as possible then they can quickly contact the district manager via a phone interview as quick as possible which maybe a day then the district manager will make that decision and then they can start. And they could be placed on the next shift so usually the schedule's set for the week and so they'll put them on that next shift.
Onboarding New Hires
(24:11 - 25:24)
Lydia: Yeah makes a ton of sense. So it sounds like it can be less than a week which is always good to get people on the door quickly. How many different documents are in your onboarding package?
Philip: Oh wow we have a lot - handbook and then also being in California we have definitely a lot of extra ones that a lot of people don't have so with our handbook it's maybe like 100 pages plus?
Philip: Yeah man handbooks. Once you go to the attorneys and get all those things.
Lydia: And you're an attorney by you know education.
Philip: Exactly, so we have a lot of notice documents of like what's upcoming so we have them sign documents of if they've been heard or if they've gotten their paycheck to all their meals and breaks. So those are all kind of documents they don't have to necessarily sign but it's like hey with COVID, now you have to give them a couple pages of documents there - handbooks maybe 20-30 pages, your application and your i-9 you have a lot of forms.
Hiring the Right Candidate
(25:25 - 27:46)
Lydia: Oh my gosh I bet. What's your process for ensuring a good match between the role you're hiring for and the candidates who are applying?
Philip: I think the double interview process, and then what we do at our restaurants is like a lot of places is a trial for three months, and so we do an assessment at the three-months mark. And so I think for the typically non-COVID, we would have the manager face-to-face and so it's usually easier to gauge somebody's skill or even like hey show me an example of when you worked on the grill or fryer or whatever it is, customer service. Over the phone it's a lot harder and so I kind of we rely on that three-month assessment.
Lydia: Typically what percent of people make it past that three-month assessment?
Philip: I would say very few people and that's why the turnover is so high. It's like once you hit the three-month assessment then I would say like 90-95% of the people will go on a year plus, like have a pretty decently long career with us or time with us. But 75-80% of people won't hit the three month mark.
Lydia: Okay so my understanding is only 20% to 25% will hit the three month mark and of those if they make it there and they pass the assessment then like 95% make it a full year.
Philip: Or more or multiple years.
Lydia: Yeah I mean you've had some people there for like a decade right?
Philip: Yeah we've had people there for 15 years, probably even longer. I had people that were working there when I was 14 or 13, working at the restaurant as well. I saw them and their kids are actually working for us as well.
Lydia: Oh wow yeah multi-generational.
Philip: Both my father and their parents.
Staying Updated with Industry News
(27:47 - 29:42)
Lydia: Yeah I mean it's crazy just having been in the business since 1989. I'm sure you've seen many generations of people come through. What do you recommend for staying up today on industry news are there any magazines newsletters podcasts that you really like?
Philip: So we do, there's that multi-franchise magazine but I think for us, we have a group chat with all the Jack in the Box operators, it's called NFA - National Franchise Association for Jack in a Box, and so they have a full organization that basically has full-time staff. They have a newsletter and so they disseminate all the information that's going on in the industry and so I think for us, it's a little easier because we have this association that kind of keeps us up to date on pretty much everything across the board as it relates to Jack in a Box, fast food, whether it's political laws that are going to happen to safety standards to what's the best mask. But yeah, I'm sure there's plenty of podcasts and things like that. I don't usually go outside because the NFA kind of takes care of all the things related to Jack in the Box because there's just so much information out there that you don't know if it actually applies to your restaurant or your industry.
Lydia: Yeah that makes total sense. Well anyway thank you so much Philip this was incredibly insightful, it was great having you on the webinar today.
Philip: Thank you for having me.
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Lydia Fayal Hall is Head of Marketing at Workstream. She previously held leadership roles at OneSignal and Chalkup, acquired by Microsoft. Lydia has written for publications including The Wall Street Journal and Forbes. She is an alum of UPenn, Johns Hopkins, and YCombinator IK12. Originally from Stonington, CT, Lydia now resides in San Francisco, CA with her Australian Shepherd, Indy.