1 FOCUS ON SUPERVISION: Guiding Principles for Supervising Success Marcia Thomsen Washington, D.C. October 25, 2005

MRT Recognize & Reward Infrastructure In Place Set Clear, Universal Goals Measure & Report Results EXECUTIONAL EXCELLENCE GUIDING PRINCIPLES FOR DRIVING EXECUTION

MRT Set Clear, Universal Goals Articulate precisely what is expected Focus entire workforce against same goals Translate goals for every business unit Communicate, communicate, communicate EXECUTIONAL EXCELLENCE GUIDING PRINCIPLE #1

MRT EXECUTIONAL EXCELLENCE Infrastructure In Place PHYSICAL Qualified, trained people at each level Workable spans of control Support System to enable success people (trainers) systems & processes materials & equipment PHILOSOPHICAL Interdependency Training/coaching/enabling culture On-site mentality GUIDING PRINCIPLE #2

MRT Every goal must be measurable Data collection must be credible Results are King mentality Regularly report to all levels Data drives decision-making and deploys workforce EXECUTIONAL EXCELLENCE Measure & Report Results GUIDING PRINCIPLE #3

MRT Recognize & Reward EXECUTIONAL EXCELLENCE Results = Rewards Structure Incentives to Reinforce Desired Results/Activities Promote all available incentives to drive team financial recognition opportunity for advancement GUIDING PRINCIPLE #4

MRT SUCCESS LOOP Connecting the four principles in a continuous loop drives success and continuous improvement

MRT State region 600 Restaurants 16,000 employees $350MM sales 28MM transactions/yr APPLYING THE PRINCIPLES: A CASE STUDY

MRT EXECUTIONAL EXCELLENCE Set Clear, Universal Goals Deliver in < 30 minutes, 85% of the time Achieve customer loyalty score of 65%+ 100% staffed restaurants/100% trained employees Hit profit plan ($40MM)

MRT SET CLEAR, UNIVERSAL GOALS Articulate precisely what is expected Focus entire workforce against same goal(s) Translate goals for every business unit Communicate, communicate, communicate Deliver in < 30 minutes, 85% of the time Achieve customer loyalty score of 65%+ 100% staffed restaurants/100% trained employees Hit profit plan ($40MM) PRINCIPLES

MRT EXECUTIONAL EXCELLENCE Infrastructure In Place DVP MARKET COACH AREA COACH RESTAURANT MANAGER SPAN OF CONTROL – FACTORS INFLUENCING SPAN OF CONTROL: Expertise/Tenure of Supervisor Health of Restaurants Geography Physical Infrastructure

MRT DVP MARKET COACH AREA COACH RESTAURANT MANAGER ON-SITE VISITS 1x/year 1x/month 1x/week FRIDAY NIGHT: ALL-HANDS ON DECK! Physical Infrastructure EXECUTIONAL EXCELLENCE Infrastructure In Place

MRT Purposeful Interdependence Train and Coach to enable success Effort Results Single Unit Mentality, not averages On-site culture; no ivory tower Management Exists to support unit We serve those who serve our customer EXECUTIONAL EXCELLENCE Infrastructure In Place Philosophical Infrastructure

MRT Philosophical Infrastructure supports inverted pyramid We serve those who serve the customer DVP MARKET COACH AREA COACH RESTAURANT MANAGER/ EMPLOYEES Training Specialist EXECUTIONAL EXCELLENCE Infrastructure In Place

MRT INFRASTRUCTURE IN PLACE PRINCIPLES DVP MARKET COACH AREA COACH RESTAURANT MANAGER/ EMPLOYEES PHYSICAL Qualified, trained people at each level Workable spans of control Support System to enable success people (trainers) systems & processes materials & equipment PHILOSOPHICAL Interdependency Training/coaching/enabling culture On-site mentality

MRT EXECUTIONAL EXCELLENCE Measure & Report Results Identify Problem Units (Outliers) Identify Best Practices Focus & Deploy Workforce Report Widely & Often

MRT CLI % < 30 Minutes Staffing/Training Profitability Customer Phone Surveys (Weekly) Automated Thru Driver Dispatch System Certified HR Specialist Register Downloads, Creates P&L CLEAR, UNIVERSAL GOALS MEASUREMENTS EXECUTIONAL EXCELLENCE Measure & Report Results

MRT TRIAGERECOVERING STABLE HEALTHY EACH BUSINESS UNIT IS LIKE A PATIENT BEST PRACTICES Observe/replicate Train Peers Promotion Pool EMERGENCY ROOM TACTICS Diagnose Problem Deploy Specialists Performance Management 30, 60, 90 day milestones Multi-level interventions

MRT TRIAGE RECOVERINGSTABLE HEALTHY Data Drives Purposeful Activity MOTIVATION Restaurant Staff Market/Area Coach Division Staff Training Specialist

MRT Data Reported Widely and Often KPI data polled weekly, monthly, quarterly Restaurant level data organized & personalized - by Market Coach - by Area Coach Rack em and Stack em - rank Best to Worst Triage Units trend reports - analyzed weekly for progress

MRT Frequent Forums to Review Results & Share Best Practices Cascading Conference Calls (or Webcasts): - DVP Market Coaches (MC) - MC Area Coaches (AC) - AC Restaurant Managers (RM) - RM Crew Attendees - DVP - MC - Specialists Attendees - DVP - MC - AC - Specialists WEEKLY ROUND-UP MONTHLY MEETINGS QUARTERLY CONFERENCES

MRT Every goal must be measurable Data collection must be credible Results are King mentality Regularly report to all levels Data drives decision-making and deploys workforce EXECUTIONAL EXCELLENCE Measure & Report Results GUIDING PRINCIPLE #3

MRT EXECUTIONAL EXCELLENCE Recognition & Reward

MRT RECOGNITION ADVANCEMENT PERFORMANCE = REWARDS

MRT PERFORMANCE REWARDS RECOGNITION ADVANCEMENT

MRT PERFORMANCE = REWARDS PERFORMANCE APPRAISAL! Annual process Tied to results vs. goals Standardized data-driven evaluation PAY RAISE % increase off base BONUS Incremental Meet or exceed result targets Exponential if excelling

MRT PERFORMANCE = REWARDS KEY PERFORMANCE INDICATORS CLI %< 30 Profit Staffing Overall RECOGNITION WEEKLY MONTHLY QUARTER ANNUAL Phone call e-Newsletter Broadcast v-mail Newsletter Personal letter Pin Qrtly Mtg Opportunity to teach Join DVP Roundtable Nominated for Manager of the Year CEO/COO Visit

MRT Restaurant Manager Training Specialist Area Coach Market Coach Division/HQ Staff ADVANCEMENT Broader Skills Broaden Influence Higher Salary Greater Prestige PERFORMANCE = REWARDS

MRT Recognize & Reward EXECUTIONAL EXCELLENCE Results = Rewards Structure Incentives to Reinforce Desired Results/Activities Promote all available incentives to drive team financial recognition opportunity for advancement GUIDING PRINCIPLE #4

MRT FOUR GUIDING PRINCIPLES FOR SUPERVISING SUCCESS