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Capturing Culture

BY CSA STAFF

It wasn’t the streak of 18 consecutive quarters of positive comp-store sales that led Richardson, Texas-based Wingstop to commit its corporate culture to paper. It was a time before that, when the company was smaller but growing.

The chain of Buffalo-style chicken-wing units was founded in 1994, with one store located on the outskirts of Dallas. Three years later, aggressive franchising efforts launched, propelling the aviation-themed concept into rapid-growth mode. Today, with 341 stores open and another 300 under development, as well as soaring comp-store-sales increases of 15.5% in 2007 and systemwide sales growth of 34.4% (from $153.7 million in 2006 to $206.6 million in 2007), the company felt it was high time to grab the cultural tiger by the tail.

“We wanted to maintain the things that were good about the company while it was still small,” said COO Bill Knight.

A self-proclaimed fan of Outback Steakhouse, Knight took a cue from the casual dining chain after attending a National Restaurant Association trade-show presentation. “The president of Outback made a presentation about the company’s corporate culture and how you could lose the heart and soul of an organization if you don’t maintain the things that are good about it,” Knight added. “That was inspirational to me.”

Inspired by Outback’s experience and culture, Knight and the Wingstop executive team started about 18 months ago conducting research on capturing and maintaining corporate culture. Knight said he scoured the Internet and happened upon a workplace guide called Cultural Compass, which contained 48 areas within the workplace to examine.

“It was a psychological test that covered a wide range of subjects, but it was primarily how employees viewed the company,” he said. Knight purchased the guide, and had 55 employees complete the questions, assessing Wingstop’s performance on a scale from 1 to 10 on each of the 48 areas.

“From that, we got a feel for the direction we needed to take,” Knight said. “We synthesized everyone’s principles and beliefs and began to create it into a document. It was a painful and excruciating process that took about a year-and-a-half from start to finish.”

The 39-page booklet, entitled “Principles & Beliefs, forming the perfect circle,” was unveiled at a company luncheon on Oct. 25, 2007. It outlined not only the Wingstop culture, but the way the company interacts with its brand partners (franchisees), vendors, guests, the community and each other.

“Principles & Beliefs” is not yet in circulation throughout the entire chain, but the implementation process is under way. The 14 company-owned stores are living the document before it is actively circulated to brand partners. Wingstop’s adoption plan is to lead by example, starting at grassroots, employee level. “When we did the psychological Cultural Compass, we came to the conclusion that our employees are pretty happy to be here.”

However, added Knight, because there was room for improvement, Wingstop set out to shore up the team-building aspect of the company.

“We are going to get involved in a national charity, as that is a way to pull people together,” he said. “And, as leaders of the company, we are making sure that we are ‘walking the walk.’

“People don’t work for companies; they work for people,” Knight said. “Capturing corporate culture and putting out a living document helps to create an environment where people want to work and one that people enjoy being a part of.”

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Wal-Mart to sell earth-friendly CDs

BY CSA STAFF

SANTA MONICA, Calif. As part of Wal-Mart’s “Earth Month” the company is selling more than 20 Universal Music Group titles that come with special earth-friendly inserts. The inserts are made with special seed paper and, according to the companies, can actually bloom into wildflowers.

The inserts, in addition to being good for the environment, also offer consumers three free digital downloads from Universal Music. Universal also said that a number of its new CDs will be packaged in third-party certified, renewable recycled board and recyclable paper.

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ODP urges rejection of Levan nominees

BY CSA STAFF

DELRAY BEACH, Fla. Office Depot is continuing to urge its shareholders to reject dissident nominees and elect the company’s nominees to its board of directors at its annual shareholders meeting this April.

In a proxy statement sent to investors, Office Depot said that Alan Levan’s proposed nominees would do little to help improve shareholder value. According to the statement, Levan’s company, Levitt Corp. has seen its share price fall about 93% over the past three years and that its subsidiary, Levitt and Sons, is in bankruptcy. Office Depot also noted that BankAtlantic, of which Levan is chairman and ceo and one of his nominees, is president of real estate, construction and development, share price has dropped approximately 75% over the past three years.

Office Depot also cited news reports that commented on Levan’s failing business ventures, as well as others that said that his nominees are not qualified to serve on Office Depot’s board of directors.

The company pointed out nominee Mark Begelman’s experience with Mars Music, a company he founded in 1997 that went bankrupt in 2002. According to Office Depot, many news reports attributed this failure to a flawed business strategy.

According to Office Depot, when Levan’s other nominee, Martin Hanaka served as chairman of Sports Authority from 1998 to 2003, the company saw its price fall by about 13%.

Office Depot stressed that its directors best understand the company and are well-suited to help the company grow.

“We strongly believe that removing two of the most experienced retailing executives from our board, including our current ceo who is driving the implementation of our strategic turnaround plan, would be highly disruptive, could delay the implementation of internal and external initiatives and could damage prospects for a successful turnaround,” Office Depot said in the proxy statement.

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