Maggiano's Stays the Course
The challenge of running a high-volume restaurant keeps Maggiano’s managers in place.
By David Farkas, Senior Editor -- Chain Leader, 4/15/2004
What does it take to make today’s managers stick around? The answer is easy: stability, a career path, above-average training, good pay and decent benefits. Yet how many restaurant chains can claim to provide all five in equal measure?
 President Mark Tormey and Recruitment Manager Carol Felthensal recruit and retain managers for Maggiano's with high pay, above-average training and good benefits. |
It could be to their benefit, according to restaurant analyst Paul Westra of SG Cowen: “Anecdotal evidence suggests that stores with five-year general managers average 20 percent higher profits than restaurants with GMs that have been there two and a half years.”
Maggiano’s Little Italy loses very few of its 300-plus managers in a year. Annual turnover stands at 10 percent. And while executives won’t say that long-term GMs necessarily make more money for Maggiano’s, parent company Brinker International counts the 28-unit chain as a core concept, meaning its profits have a significant impact on earnings.
Stable Setup
Founded in 1991, Maggiano’s opened under the umbrella of Lettuce Entertain You Enterprises. The success of the Chicago company is based on partners opening and operating one-of-a-kind restaurants for long periods of time. The setup brings stability to the workplace; managers rarely leave, with many hoping to become partners themselves.
“When we started we thought there’d be just one owner,” recalls Carol Felthensal, recruitment manager for Maggiano’s. “That was the philosophy of Lettuce.” But things changed four years later when Lettuce sold the high-volume concept to Dallas-based Brinker.
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Maggiano's has been growing rapidly, leading to promotions in both the front and back of the house. The chain has nearly doubled in size since 2001 and now employs more than 300 managers. Brinker opened four Maggiano’s in the current fiscal year, ending in June. The chain, which will rack up sales of about $250 million this year, expects to add four to six units annually for several years.
Back to School
Because the company has been promoting many people to general managers and executive chefs, it is launching a new training program this summer to equip promising managers with the skills a modern GM needs to run a $10 million business.
President Mark Tormey describes the program as “advanced-placement courses for key employees.” The chain’s area supervisors—all former Maggiano’s GMs—will teach classes in accounting, labor scheduling and legal issues.
Managers undergo eight weeks of training, six of them at a Maggiano’s in Oak Brook, Ill. Trainees, always a mix of kitchen and dining-room managers, stay in a nearby hotel in their own rooms and get time off for recreation or to return home, which the company pays for. They earn about $800 a week during the training period.
 One-third of Maggiano's hourly employees rise through the ranks to become managers. |
There is a lot to learn. “The biggest problem managers face is multitasking,” says Jeff Godecker, a recently promoted general manager in McLean, Va., who worked his way up from waiter. “These are such large, physical spaces that contain five little businesses: a lunch, dinner, bar, carryout and banquets.”
The unit he runs at Tyson’s Corners mall grosses well over the chain’s $9.7 million sales average. That makes it a particularly tough challenge for new managers.
High Volume, High Pay
Maggiano’s compensation is one draw for them. Salaries are at or near the top of pay scales for high-volume eateries. Managers earn from $38,000 to $55,000 with quarterly bonuses. General managers, who make $55,000 or more, receive up to 30 percent of their salaries in bonus money.
The bonus increases to 40 percent of salary if GMs are named “managing partners,” a designation achieved after meeting stringent performance goals that convince the handful of other managing partners that those GMs belong among them.
There is also the usual raft of benefits: 401(k) plan, two-week vacations, stock options and health insurance.
Management Material
The package is helpful in luring the type of employee officials are seeking, especially back-of-the-house managers. “We tend to attract people in their late 20s and early 30s who are realizing the limitations of creativity in independent restaurants. Maybe they can’t get insurance. But they still want to work in a fresh, made-from-scratch environment,” Felsenthal explains.
Felsenthal, in fact, no longer visits college campuses to interview manager candidates because they typically lack the skill set she’s looking for. “Maggiano’s is complex and very busy. We look for maturity,” she says.
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Company officials consider the rigors of the job an advantage. They contend such work appeals only to experienced managers. Some of those employees, like Godecker, make their way through the ranks. Increasingly, however, the chain is looking outside its own labor pool for management timber. Officials estimate two-thirds of the 100 recruits needed this year will come from outside the organization.
Those who do rise through the ranks are supervised closely by their bosses and evaluated by their peers. Managers, Felsenthal says, look for signs of leadership. A crucial sign: They have begun separating themselves from their hourly peers.
She also carefully considers how aspiring managers express themselves because it reveals whether they are in the job for the long haul. “I want to know if there’s a huge desire to be in the business,” Felsenthal explains.
When she finds appropriate managerial candidates, Felsenthal looks for a suitable opening. She mentions a “key hourly” employee who was recently transferred from Tampa, Fla., to Atlanta for training as a banquet manager. “Atlanta will be her proving ground,” she says.
Felsenthal believes it’s “an easy out” to pull people from the ranks and push them ahead, often moving them into a job before they are ready. “Time in grade is more important these days,” she acknowledges.
 Managers initially undergo eight weeks of training, six of them at Maggiano's 25,000-square-foot unit in Oak Brook, Ill. |
Read All About It
Maggiano’s realizes a love of work, top compensation and benefits are all necessary to keep good managers. But there’s also the matter of communication, which is difficult in a rapidly growing chain.
To that end, the company publishes a colorful quarterly newsletter, La Dolce Vita, exclusively for store managers. The eight-page publication includes managers’ best practices, a list of new sites, celebrity sightings, culinary updates, news, promotions and a Q and A with Tormey.
Tormey is, by the way, the Maggiano’s manager with the longest tenure, having founded the chain in 1991 in Chicago. He credits his time in grade to Brinker International. “They have been a spectacular partner, providing resources and counsel to grow. They have let us move forward as we have seen fit,” he explains.
Felsenthal is not sure of the average tenure of general managers or area directors. “Five years? It’s a complete guess,” she says. “There are a lot of people like me, though. Been here since the beginning.”
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