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The good and bad of admitting mistakes

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If the restaurant industry reflects what’s happening in society as a whole, overbearing parents will soon be trying to out-brag one another about whose kid is the biggest screwup. Failure is suddenly a proudly worn badge of distinction, particularly in business, and especially in the restaurant game.

We should have known this would happen after Liz Smith, the CEO of Outback parent Bloomin’ Brands, mentioned from the stage of the Restaurant Leadership Conference that she celebrates stumbles. Smith, a former president of Avon and undeniably a leader in her new field, explained how she lists her failures on a “wall of shame” outside her office and shared her mantra of, “Fail faster”—take the learning and improve instantly, so you’re smarter despite the bruises.

Now the notion of celebrating missteps is seeping into the industry on a broad scope. Clover Food Lab, a six-unit, seven-truck quick-service chain, has a link on its homepage to a listing of mistakes. It even offers a mea culpa on the page listing its locations, acknowledging that it had initially kept its sites secret. The “Doh!” is inferred. It also points out that its typical serving time, at 3 ½ minutes, is slower than McDonald’s.

Yum! Brands publicly acknowledged that 20 percent of consumers didn’t like the new Colonel Sanders it’d resurrected in the form of comic Darrell Hammond. Cosi CEO R.J. Dourney admitted he’d underestimated how difficult and time-consuming a turnaround would be. Subway volunteered that it’d been alerted years ago that Jared Fogle had a thing for underage girls.

El Pollo Loco owned up to dampening sales by eliminating a lineup of bargain-priced combo meals. And Liz Smith noted (presumably on her wall) that Bloomin’s Bonefish Grill had cut into traffic by dropping discounts and pushing the menu upmarket, complicating operations and slowing service. Expansion of the brand has been halted until the problem is fixed.

McDonald’s hopefully packs a lunch when it slips into the confessional. New management has been blunt about mistakes of its predecessors, and it’s added some blunders of its own to the litany with the admission that one-third-pound sirloin burgers were far from a hit this summer.

It remains to be seen if confession is good for more than the soul. But there are signs of at least one party’s refusal to forgive and forget. They’re called investors.

A group of them are suing El Pollo Loco because of the discounting mistake, which has since been reversed. They’ve filed a class-action suit that asserts the chain’s management didn’t ’fess up to the problem soon enough and purposely tried to mislead them. They say it was the classic naughty schoolboys’ move of acting as if they’d done nothing wrong.

Of course, the true ruler-wielding school principal in such matters is the public. The call of the day is for transparency, a complete openness about what’s on the menu, in the kitchen and under discussion in headquarters. Will they respond favorably to admittedly unacceptable behavior, as they did to Domino’s confession that it had been serving god-awful pizza for much of its existence?

The indications are that it will. But I could be mistaken.

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