How can you use performance metrics to improve labor cost management in your food and beverage operation?

2 Why are performance metrics important?

Performance metrics are essential for managing labor cost. They enable you to analyze the factors that influence labor cost, such as sales volume, menu mix, staffing levels, and wage rates. Additionally, they facilitate setting realistic and achievable goals and benchmarks for labor cost and other aspects of your operation. With performance metrics you can also monitor and evaluate progress against your goals and benchmarks, identify and address any gaps or issues in labor cost management, communicate and motivate staff to achieve goals, as well as reward and recognize staff for their achievements and contributions.

3 How to use performance metrics?

In order to utilize performance metrics effectively, you must follow a systematic process that includes four steps. Firstly, you should decide which performance metrics are relevant and meaningful for your operation, and align them with your vision, mission, and objectives. Secondly, you must gather and organize the data needed to calculate and report your performance metrics from reliable and consistent sources. Thirdly, you should interpret and compare your performance metrics against your goals, benchmarks, and industry standards using the right tools and techniques. Lastly, you should take action based on your analysis such as adjusting labor cost budget or scheduling training, track the results and impact of your actions.

4 How to improve performance metrics?

Improving performance metrics is not a one-time event, but a continuous cycle of monitoring, evaluation, and improvement. To achieve this, you should review your performance metrics regularly and frequently, engaging your staff in the process by soliciting their feedback and ideas. Celebrating successes and learning from failures are also important steps. Acknowledge and reward your staff for their performance and improvement, share best practices and lessons learned, and identify and analyze the root causes of any performance gaps or issues. Implementing corrective and preventive measures will help ensure that your performance metrics continue to improve.

5 How to choose performance metrics?

When deciding on performance metrics, it's important to consider the type, size, scope, and goals of your operation. You should also take into account your operation's characteristics, such as the concept, menu, service style, target market, and location. Additionally, you should evaluate your operation's priorities and resources, such as the availability and quality of data or the capacity and capability of staff. Finally, you should consider the expectations and needs of your stakeholders, such as customers, employees, managers, owners, and partners. Choosing performance metrics is a customized and strategic decision that requires careful consideration.