Danny Meyer’s Four Secrets for Managing Culture
Union Square Hospitality Group Founder and CEO Danny Meyer didn’t invent the hamburger, the milkshake, or the crinkle-fry. But he is responsible for one of the major players in today’s fast-food game: Shake Shack. The secret behind the chain’s success? A strong brand with a sense of cultural relevance. At our 2018 CEO Summit, Meyer sat down for a conversation with F3 founding partner Anu Duggal (who, fun fact, interned for him at Tabla back in 2001!). During their talk, Meyer explained that a sticky culture — combined with innovation — will give you the upper hand in a saturated market.
“If an idea is really that great, it will be copied more quickly and maybe even better than the original,” Meyer said. In an industry where presentation matters, competitors take photos of everything from the bread to the water glasses for inspiration. (Meyer himself was recently caught photographing a pepper mill.) Still, it’s impossible for a phone to capture and replicate the essential hospitality transaction of how your brand makes a customer feel. “Human beings have a deep-seated need to belong, and if our culture is so sticky that everyone wants to belong to it — staff wants to belong to your brand, customers want to be seen wearing your thing, using your thing, walking down the street with a bag that’s got your label on it because of what it says about them — then you’ve got the ultimate competitive edge.”
How do you create a sticky culture? These are Meyer’s four tips:
Put your employees first
The idea of “winning or losing on how we make people feel” starts with employees. In the ’90s, after he opened his second restaurant, Gramercy Tavern, Meyer created a company philosophy called the “Virtuous Cycle of Enlightened Hospitality” to teach employees about his values and empower them to make the right decisions when interacting with guests. “We start with caring for each other, then caring for our guests, then caring for the community in which we’re doing business, then caring for our suppliers and investors,” he said of this chain reaction. “It took three years for me to convince people that this was not a linear list where the investor is at the very bottom of the totem pole, but rather a virtuous cycle where, if you broke it anywhere, you broke the whole thing.”
Retain and promote your culture carriers
Culture carriers are those superstar employees who have enough sparkle to set a positive tone, lay the groundwork for behavioral standards, and form meaningful relationships with other employees. These are the key players in any workplace, and they’re essential to growing the business. “Understand who your culture carriers are, and make sure every time you grow, those are the people who get the promotions,” Meyer said.
Use digital technology only where necessary
“We believe that the ultimate, best use of digital is at the intersection of experience and convenience of using it,” Meyer said. “So if the digital product makes my life more difficult, it’s not a good digital product.” He recounted a friend’s experience making a reservation online. “This system was making life better for the restaurant because it eliminated no-shows, but it was making my friend’s life as consumer a lot worse because he had to pay in advance, and he didn’t want to pay in advance. [Technology needs] to make everybody’s life better, and if it does, it’s worth it. Otherwise, it’s just kind of useless.”
Care for the community
Shake Shack — Meyer’s best-known business venture, was born out of Union Square Hospitality Group’s desire to create better workplace for his employees. “In 1998, when we first signed our leases for Tabla and Eleven Madison Park, Madison Square Park was a disaster,” Meyer said. “It was dangerous, it was unkempt, you just didn’t want to be there.” To improve the park, he collected $11 million from the companies headquartered nearby, hired gardeners and landscapers, put in new pathways, and started an art program. That art program attracted artists from Thailand who “came up with this crazy idea to do two taxicabs on stilts with a working hot dog cart.” The hot dogs were prepared at Eleven Madison Park, and profits were funneled back into the Madison Square Park beautification project. Soon, that hot dog cart evolved into what we now know as Shake Shack, all thanks to Meyer’s workplace philosophy.
“Hospitality exists when the other person feels like you’re on their side, when you do something for them,” Meyer said. “The opposite is when you do something to somebody.” In the hospitality industry, Danny Meyer is known as much for his virtuous cycle as he is for USHG’s roster restaurants. Oftentimes, we use the phrase “on-brand” to describe consistency in decor, cuisine, and social media content, but at the end of the day, these elements are all extensions of a brand’s culture. When the culture is consistent, everything else falls into place, and it’s that much easier to make consumers feel like part of your brand’s family.
