Leadership

What were they thinking???

Politics, poorly considered comparisons, bad texts and poorly conceived relief plans: The biggest restaurant blunders of 2021.
Photo illustration by RB Staff

At a time of heightened political and social sensitivities, even the most mindful decisionmaker can sometimes smudge the line between acceptable and questionable. These full-on gaffs are as different from those misdemeanors as a lightning bolt is from a lightning bug.

We’re talking about jaw-dropping misfires, not a faux pas easily tsk-tsked away. Call us persnickety, but we don’t know of an occasion when a reference to Nazi policies is going to work as illumination. Nor is it advisable to promise millions of dollars to enterprises struggling to stay afloat, only to yank back the lifeline a few days later.

But see for yourself. Here are the blunders that had us wondering, How can smart people stumble this badly?

Howard Schultz’s Nazi reference
Everything was going superbly in the Starbucks builder’s presentation to several hundred employees in Buffalo, N.Y. back in mid-November. The baristas had gathered for a pitch from Schultz and other Starbucks officials on remaining union-free, a matter that was about to be decided at three branches in the area.

Just a few days before the employees of those stores were due to receive mail-in ballots on organizing, Schultz, a gifted orator, was explaining how he’d engineered the company to be as devoted to its “partners” as it was to its shareholders and customers. What other restaurant employer-offered health insurance, college tuition and a chance to amass stock? With that sort of paternalistic culture, why vote to bring in a union? 

It was a moving, seemingly effective presentation. Then Schultz strayed, badly. He recounted how the Third Reich provided every sixth inmate of its concentration camps with a blanket. “Most people shared their blanket with five other people,” Schultz said, according to a video of the event. “So much of that story is threaded into what we have tried to do at Starbucks, to share our blanket.”

The impact on union voting remains to be seen.

Politics instead of pepperoni
The year didn’t start well for Rave Restaurant Brands, parent of Pizza Inn and Pie Five chains. The company’s stock price had dipped so low that the franchisor was in danger of being booted off the NASDAQ stock exchange. The off-premise boom that ignited other pizza chains’ sales during the pandemic had failed to deliver the same sort of lift to Rave’s two brands.

And that, the company’s CEO decided, was the appropriate time for him to weigh in on the disputed presidential election of two months earlier.

Rave issued a 700-word press release detailing why CEO Brendan Solano believed the appropriate authorities should conduct a 10-day audit of Election Day results before declaring Joe Biden the winner. Instead of focusing on pepperoni, Solano called for such political moves as outlawing absentee ballots and electronic voting machines.

The missive sparked such a controversy that the press release was yanked off the wire service that initially carried it, and at least one vendor resigned the account.

It didn’t help that Solano aired his political peregrinations when he did. It was Jan. 5, the day before other doubters stormed Congress in a violent attempt to thwart Biden’s victory.

McDonald’s latest controversial McSend
McDonald’s directors really need to review the company’s policies on executive’s use of email. Last year Steve Easterbrook was dethroned as CEO because of his embrace of that channel as a way to romance subordinates. Now his successor, Chris Kempczinski, has earned a sad face emoji by hitting Send on a message he likely wishes he could take back.

The note, sent to Chicago Mayor Lori Lightfoot, faults the parents of two young shooting victims for the children’s deaths. With both, the parents failed those kids which I know is something you can’t say. Even harder to fix,” Kempczinski wrote.

Unions took up the message, revealed as a result of a Freedom of Information filing, as proof of their accusations that racism is embedded in McDonald’s culture. Kempczinski is white, and the victims were both children of color.

It sounds more like elitism than racism to us. But there’s no denying it was a dunderheaded way of referring to parents who’d just lost a child.

The Restaurant Revitalization Fund
Seldom has such a well-intentioned government initiative gone so astoundingly wrong. The RRF, in case you’ve suppressed that memory, was created by Congress as a way of saving restaurants through grants of up to $10 million. The total kitty of $28.6 billion was to be used for normal operating expenses, with relatively few strings attached.

Because the RFF was intended as a lifeline, the legislation creating it gave a first shot at the funds to restaurateurs who were presumably most in need of assistance: Women, veterans and individuals who were both economically and socially disadvantaged.  The loan requests from those parties would be the only ones considered during the first 21 days of the program.

The demand was overwhelming. By the 21-day mark, the Fund was already out of money.  About 265,000 applicants were turned away without getting a dime.

Among the 105,000 operators who qualified for the aid were several thousand who were part of the 21-day priority group.  But at least 3,000 of those applicants learned after being told they qualified for a grant that the money wouldn’t be coming or had been pulled out of their bank accounts. Operators outside of that class had successfully sued to block the awards, saying the prioritization process was discriminatory.

To this day, industry associations are besieging Congress to right its error by earmarking more aid funds for restaurants.

Subway’s melt sandwich meltdown
It’s usually not a good thing when franchisees issue a formal warning that their chain’s newest product is too dangerous to stock. Yet the North American Association of Subway Franchisees did exactly that when the brand added a line of melt sandwiches in mid-spring.

Part of the sandwiches’ appeal was the amount of cheese they packed. To melt that load, employees initially needed to place the sandwiches into a toaster by hand (the home office eventually encouraged a switch to tongs or paddles.) Workers were burning themselves at a rate that convinced the association to withdraw its support for the intro. The operators found the process also wore down their toasters.

“We are incredibly disappointed in FWH leadership’s plan to move full steam ahead with this launch before these significant issues are resolved,” the association said in a letter sent to the entire system, referring to the brand’s home office, or Franchise World Headquarters.

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