ON TUESDAY, FEBRUARY 21, 2017, CNBC ran this headline: “Restaurant Brands in Deal to Acquire Popeyes Louisiana Kitchen for $1.8 billion.” The deal announcement stated that Restaurant Brands International (RBI) would pay $79 a share in cash for Popeyes, “a 27 percent premium to Popeyes.
RBI communicated its $79 offer to the Popeyes board of directors on Presidents’ Day weekend of 2017. The board deliberated and deemed the proposal was in the best interest of the shareholders. I announced the decision to the franchisees and employees early Tuesday morning, February 21, and then the press release hit the Associated Press wire. With the news of the sale, there would be a new owner, a new strategy, a new culture, and a new leadership team.
My tenure as CEO ended with the sale closing on March 27, 2017. That afternoon, the CEO of RBI, Daniel Schwartz, came to my office, shook my hand, and wished me well. I went to the People Services department and gave them my employee badge and office key and carried my box of photos and mementos out to the car. Nine years and five months from beginning to end.
One week later, I drove to Charlotte, North Carolina, to honor a long-standing commitment to speak at a leadership event for about one hundred executives from companies across the Southeast. I gave my prepared speech and then asked if there were any questions. The first question was “People say that the legacy of a leader is best expressed by what happens after they leave the role. How do you feel about your exit from Popeyes?”
I answered the question by saying, “A public-company board of directors hired me to lead Popeyes. I loved the Popeyes team and the results we created for the franchisees, but I was never the owner of the company. My work was in service to this organization. I am grateful to the board for giving me the opportunity to lead by the principles I believe drive superior performance. It has been an incredible capstone career experience. I rest well knowing that, for nearly ten years, this leadership team has served well. That will be our legacy.”
More than a year has now passed since the sale of the company, and I have had time to rest and reflect on the experience. I’ve even had the wonderful opportunity to teach about the Popeyes transformation to a group of second-year MBA students at Indiana University, my alma mater. The process of preparing for this course reminded me of the essential elements of turning around an enterprise. For those of you needing to change the trajectory of your organization, here is a summary of the framework we used to lead a successful transformation at Popeyes.
Always listen first. We began the turnaround of Popeyes with a listening tour of seven cities—hearing from franchisees, restaurant managers, and guests. Every strategy we selected stemmed from what we learned on this trip. Over the next nine years, if we hit a bump in performance results, we went back out and listened again.
Simon Sinek’s popular book tells us to “start with why.” And it’s a compelling principle. Knowing why you are doing something is essential to your inspiration and motivation to act. Until the organization knows the why of the work, they won’t view the work as very important or meaningful. The purpose we selected at Popeyes was
“We inspire servant leaders to achieve superior results.”
What did we believe? We believed that serving performs. That was our thesis for the turnaround. That was the purpose that rallied people to perform. But perhaps the most important why to understand is why the people come to work. At Popeyes, the Journey to Personal Purpose helped individuals become conscious of their values, their strengths, and their life experiences so that they could articulate why they came to work at Popeyes. This understanding led to a significantly higher level of engagement and commitment to the enterprise.
Decide what needs to be addressed to return the company to a prospering position in the industry. What are the top three to five things that must happen to change the performance trajectory? They should be daring, gamechanging ideas, far from the status quo. The strategies become the what that you will ask the organization to do. Every strategy has a goal attached to it that defines what a win will look like. There is clarity about the daring destination. At Popeyes, we initially chose brand repositioning, speed-of-service improvement, restaurant P&L improvement, and better real estate selection as our four strategic pillars. These were the vital few, courageous steps we needed to take to get guests back in the restaurant for a better experience and to provide the franchise owners with a viable business model. Basic, but big, steps forward.
Carefully select a half dozen principles that will guide how you accomplish the work ahead. These are value statements. They tell the organization how to behave and how to arrive at the right decision. If you have a principle of collaboration, it directs the organization to work with others to accomplish the goal. If you have a principle of learning, it suggests that you encourage taking risks and learning from mistakes. To help the organization understand the principle, provide a detailed explanation of what that principle looks like in daily behaviors. Model the principles. Correct when you see errors.
Review talent in every area of the organization, looking for the capability you need to execute the strategies and for the character traits you need to live the purpose and principles. Competence is important. Character is even more important. See talent as a full-blown strategy with detailed plans, tools, and systems. Hire a human resource leader with substantial depth of experience in talent management processes. These are not soft skills. These are concrete processes that plan, execute, and track the growth of your leaders. My observation is that few organizations have a rigorous talent management system that is executed consistently.
Leaders often underestimate the importance of good messaging to every stakeholder—to give clarity to the plan and expectations, to inspire and encourage, and to reassure and calm. Develop messaging skills in the leadership of the company through training and real-life practice. Be consistent in messaging so that people remember and trust the direction.
When I teach on Dare-to-Serve leadership, the audience often thinks the strategy is a “philosophy,” not a path to performance. The only way to change that mind-set is to demonstrate results. Start with crisply stated, concrete goals. Create a dashboard to track progress against the goals. When the team falls short of goals, stop and regroup. Find another way to get to the goal. Until performance results occur, you are not serving the people well.
THE LEGACY OF THE LEADER
In wrapping up the Popeyes story, I share with you what I believe is the most important legacy of this leadership team. We taught, encouraged, and prepared dozens of leaders to exhibit Dare-to-Serve leadership. These leaders are now taking those principles far and wide in new leadership roles. In retrospect, the sale of Popeyes has been a “sending out” of leaders who are ready to serve. From my perspective, the Popeyes story ended too soon, but perhaps the real ending is yet to be written.
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