Multi-store concept with over 160 locations saves thousands of dollars and dramatically decreases their cost of sales with WhenToManage Restaurant Solutions
BACKGROUND
Lone Star Steakhouse, Texas Land and Cattle Steak House, Del Frisco’s Steakhouse and Sullivan’s Steakhouse, operating with a combined 161 restaurants, was struggling to identify return on investment (ROI) during marketing campaign execution. The marketing team identified campaign initiatives in which thousands had been spent on ads or promotions, without a clear picture of their effectiveness. In order to run a more cost-effective marketing organization, the leadership team looked for a solution that could provide instant access to historical sales data, guest trends and cost analysis from the store and enterprise level without taxing the IT team with a lengthy report creating process.
WhenToManage Restaurant Solutions offers restaurants and the retail industry — from small, single-location operations to multi-national chains — web-based software solutions that simplify reporting, inventory management, employee scheduling and guest relations. By implementing and using the WhenToManage business intelligence platform, John Tanski, Lone Star Steakhouse’s IT Field Support manager, was able to provide the information that Lone Star Executives needed to improve campaign execution through real-time knowledge of the success of established regional, national and pilot concepts.
THE PROBLEM
With outdated technology in use at the enterprise level, the Lone Star Steakhouse Marketing team found that measuring campaign ROI was a persistent problem; with limited insight into actual performance until many weeks after critical milestone dates, unsuccessful programs were often left in place. The challenge was similar to that faced by nearly every company running numerous locations: it takes time to compile sales, item and inventory data from individual stores and compare results. Prior to deploying WhenToManage, Tanski was faced with the difficult task of negotiating the delicate waters of shifting priorities: query reports or provide field-level support.
“When campaigns were executed, the Marketing team would naturally want to know how the campaign was doing,” said Tanski. “However, complying with this task was my IT team’s worst nightmare.” Each store had to be analyzed to assess the performance of the program against the marketing team’s business expectations. This required multiple point of sale (POS) data extracts and the time necessary to accomplish this task was immense.
“We support our corporate users and we wanted to help. However, each store required about an hour of data extraction, and dozens of stores could be affected. Add to that the task of compiling the data into spreadsheets and crafting the right report, and the hours just piled up,” said Tanski. “It could take as much as 10 hours to create a single report, so the requests — although necessary — would create conflicting priorities. We would have to extract, run and create reports and at the same time provide store personnel with the IT support they desperately needed in order to run their business.
Needless to say, we were slammed and it was very difficult for my team.” Because of these challenges, Tanski began to search for a solution that would decrease the time to create a report and “free the data” so that any department could uncover information to both support and evaluate their initiatives. “We knew we had to find something that was easy to deploy, easy to use and didn’t require extensive or difficult training. It had to be user-friendly for a variety of levels and by a number of departments, including Marketing, Purchasing, Operations, management teams and our company Executives,” Tanski explained.
ANALYSIS OF ALTERNATIVES
The size of the Lone Star Steakhouse operations and the number of stores needing support meant very specific business requirements for any solutions partner. Beyond outstanding data reporting, the solution had to integrate with multiple applications currently used at the enterprise and store-level, including the POS used by the company. After evaluating several solutions and even considering building an in-house system, the company uncovered a key requirement not previously considered: the selected system needed to be web-based. It was determined a client-side application would be difficult to deploy and secure, adding a significant cost burden in integration, launch and ongoing maintenance. A browser-based software as a service (SaaS) product would be easily available to any store manager, company employee or Executive working from home or on the road.
RESULTS
After considering a number of alternatives, Lone Star Steakhouse chose WhenToManage because of the company’s ability to provide web-based, real-time data and decrease the amount of staff time required for reporting. “At first it was a big jump to change how we were operating at the functional level, but the WhenToManage team realized this and made good on understanding our business requirements. What’s more, we learned that more than IT and Marketing benefited from the application usage. The Purchasing team was able to see how much they were spending on specific inventory items. The Operations team could receive automatically generated reports based on many different metrics. Other teams began to take notice, and adopt WhenToManage for their own initiatives. New uses for the application seemed to grow organically out of departmental meetings and then when applied, helped immediately,” said Tanski.
Lone Star Steakhouse began a store-by-store implementation and in weeks had the initial sites up and running and had trained all affected store managers. Once launched, the WhenToManage solution quickly developed into the go-to application by fundamentally changing how data flowed across the organization. “Departments started knowing more and collaborating because the data was right there — instantly accessible,” said Tanski.
According to a report by the International Data Corporation (IDC), workers spend between 15 and 35 percent of their time searching for information while finding what they need only 50 percent of the time or less. By “freeing” Lone Star’s information; making it easy to utilize by employees, many immediate results and benefits were realized:
● Because they were able to measure impact immediately rather than waiting weeks or even months for reports, the Marketing team chose to eliminate all of the “loss-leader” campaigns they had once assumed were just part of doing business. This alone saved the company thousands of dollars in just a few weeks.
● By using the application, Lone Star was able to launch more test menus in new markets and perform immediate analysis on their effectiveness.
● The Operations team was able to run inventory reports and more effectively account for stock levels, decreasing the cost of sale ten-fold.
● The Executive team used WhenToManage to create board reports with the real-time report creator. The report accuracy and timeliness proved invaluable during key decision-making points and provided the board with more pin-point data, leading to better decisions.
By making fundamental improvements to information flow, the IT department at Lone Star has been able to make myriad improvements thanks to the WhenToManage implementation:
● Improved menu engineering. Lone Star is now able to run product mix reports before making updates, allowing them to determine sales, food cost and decide on adjustments in real time. After new menus are rolled out, weekly reports track sales of new items to measure their success far more quickly than before.
● Better promotion tracking. Because WhenToManage can track individual items in a large promotion, Lone Star has been able to accurately determine which items in that promotion were working and quickly make product lineup changes and replace under-performing items with new selections.
● More detailed testing. Like most restaurants, Lone Star likes to test promotions, and WhenToManage allows for better detail than ever before. Lone Star recently tested an entire menu in a select group of restaurants, pulling tracking data weekly. Every four weeks, the Finance department would use this data to determine which items should roll to the full system. By having this data readily available, Lone Star is able to make decisions much faster, which both saves money and maximizes profit and customer satisfaction.
“WhenToManage was a breath of fresh air. We moved from 1980s technology to the 21st century in just a few weeks,” said Tanski. “Just by eliminating the practice of manipulating inventory levels, WhenToManage helped us improve our bottom line and energized the Executive team to do more and spread the application to all the departments — that’s when the collaboration really happened” he added.
