EntreLeadership - #269: Dare to Serve with Cheryl Bachelder

Episode Date: June 4, 2018

In 2007, when Cheryl Bachelder took over as CEO of Popeyes Louisiana Kitchen, Inc., the company was a mess. Profits were down, stock prices were at an all-time low, and morale had hit rock bottom. She knew her only hope of turning things around was to create a culture of servant leadership. And she was right. By investing in her most valuable resource—her team members and franchisees—Cheryl helped Popeyes reach $3.1 billion in revenue by fiscal year-end 2015. Tune in as Cheryl details the six principles of servant leadership that she credits for that success. They may very well contribute to yours too. entreleadership.com/podcast How to Create Core Values from EntreLeadership 50 Ways to WOW Your Customers from Infusionsoft Want expert help with your business question? Call 844-944-1070 and leave a message or send an email to [e-mail]. You could be featured on a future podcast episode! Learn more about your ad choices. Visit megaphone.fm/adchoices

The people in your organization are the only purpose and principles anyone ever meets. Helping business leaders grow themselves, their team, and their profits. This is Andre Leadership. Now, here's your host, Ken Coleman. Coming to you from the Music City, this is the broadcast of leaders by leaders for leaders. Thank you so much for joining the conversation. Our feature conversation this episode is with Cheryl Batchelder, the former CEO, of Popeye's Chicken and the author of Dare to Serve,

how to drive superior results by serving others. And we also have some great free resources for you that you have come to love. Well, I got to tell you, Cheryl Batchelder is a fantastic lady. Obviously, when you're the CEO of any type of quick serve restaurant or any national chain, you are accomplished. But what I love is that she took over a company where the stock price had dropped from $34 to $13. It's basically going to the basement.

And in eight years, the market cap grew from less than $300 million to over $1.3 billion. At fiscal year in 2015, Popeye's revenues were $3.1 billion in growing, all because of this idea of serving others. And this lady is phenomenal. This is a great book. And I think it really does give you a different perspective on true servant leadership, a that many of you've heard before. But this conversation is really going to challenge you.

Here is Cheryl Batchel. The reason I love this story is because I don't know if most people know this until they read the book, but this was a second chance for you as well, not just Popeye's. And so before we dive into the book and how you led Popeye's through a downtime and really a rebirth, I want people to have a sense of where you were at, what you had gone through and a failure, if you will, before you got the opportunity to lead Popeyes in 2007. Well, that is a great place to start. You know, I often say that you don't learn a whole lot from your success, but boy, a failure will teach you a lesson or two.

And that was certainly the case for me. My first job as president of a public company was at KFC, the restaurant chain in Louisville, Kentucky. And in that role, I failed, failed quite miserably and quite publicly. was fired on a Friday in the fall of 2003 and spent a few years on the bench, kind of as coaches would say, looking at the tapes and saying, what did I learn from that experience? Where did it go wrong? What would I do differently if I was ever given the opportunity?

And today I look back on that as the greatest blessing because everything that I put into play from a leadership approach at Popeyes came from the lessons that I learned at that very public failure. I want to do a follow-up question here because I'm curious to know what your mindset was when you got the opportunity to interview and you knew you were a candidate to take over Popeyes because you'd been on the bench, you'd been very intentional to study, what did I do wrong? What could I do better? What would I do different?

All the things that you just talked about in self-examination. Did that self-examination give you more confidence than maybe you would have had? or did you still wrestle with a little bit of, uh-oh, can I really do this? Because I failed last. I'm just curious how you came off of that failure as you stepped into the new opportunity with Popeyes. Well, you know, I think after that failure, I wasn't sure that I ever would practice as a president or CEO again. You're never sure this is a big state kind of a job and opportunities are few and far between. So I decided to serve on boards.

and one of the boards I was serving on was the board of Popeyes. And the CEO quit unexpectedly. And after some back and forth, the board turned to me and asked if I would be interested in taking Popeyes forward and leading the transformation of that brand. And to be honest, I hadn't been thinking about that. So I had to really say, is this the moment to put those lessons to work for the benefit of Popeyes and for the employees, not for me, to just see if the people, there wasn't a better way to drive performance results than I had experienced in the past.

So I was flattered for sure and maybe more confident just because quite a bit of time had passed that I'd had to think about the prior experience, but excited for sure to be offered such an opportunity. Okay, now give us a snapshot. Where was Popeye's at at this moment? You get the gig. Here you are. Back in that leadership chair again, what were you facing? Well, it was not a good time. The brand had been around for 35 years, but it was in a tired,

underperforming spot. They had experienced seven years of declining traffic to the restaurants, visits to the restaurants. Profits were down for the franchisee owners, market share was down, the stock price was down, rock bottom. It was $13 in the fall of 2007. No one was happy. Owners weren't happy. Employees were discouraged. Morale was low. And certainly the board and the shareholders weren't happy with performance. So, you know, it was either a low spot or a great opportunity for a new approach. I'm just curious, you know, because I don't know that I've had the opportunity to talk with someone who has really architected a turnaround like this as I'm thinking back on all the people I get to talk to. I'm just curious, what were the things you did in those first 30 days? Well, a couple of things.

very first day on the job was standing at a convention in front of all the franchise owners in Orlando, Florida. And so on my very first day, I had to do something to cause them to be interested in a business plan that can turn around the company. At that point, I called it declaring a daring destination. All I really told them was that our goal was to transform this company into a top-performing quick service restaurant company. On that day, I didn't know how we were going to do that, but I wanted to assure them that we had bold transformational objectives for the company. And then the second step to that was to get on the road and go talk to the people that did

know what needed to be done, the employees in the restaurants, the franchise owners who own them, the people in the company office or in the company field support positions. These people had worked there a long time, and they knew it. exactly what the challenges were to the business. I called it a listening tour. We went to seven cities. And from that feedback, from that listening, we were able to garner the essential things that needed to be addressed at Popeyes. Okay, let's stay right there where you left us. So now you've gone out and you've listened and you've got real clear ideas on what needed to be done and how it could be done. And now back to that first day when you stood up and said,

hey, we're going to have a bold plan and we are going to turn this thing around. So armed with that initial declaration and now some information, how bold were you? What were some of those bold steps? Well, we created a one-page roadmap to results. I wanted everyone in the organization to be able to have it with them and understand the bold things that we were going to chase. First, we had on that page our goals. We wanted to get restaurant sales up 20 percent.

We wanted to dramatically improve restaurant operating profits so that the owners could make a good return. We wanted to build market share and we wanted to build a lot more Popeyes for you that love Popeyes. So we had very clear, bold goals. Then we declared our strategies. We said we wanted exceptional product innovation, lots of new, exciting foods that were delicious that you would want to try. We said we wanted to have faster drive-through service for you so that you could get through. through quick. We wanted to save a lot of money in the supply chain for our owners to move those margins up. And then we wanted to build our restaurants on better real estate so that they would

perform better for the investor. So those were the major strategies that we set out to accomplish. They weren't fast, but over the next three to five years, we were able to accomplish or surpass all of our goals. Wow. And so I think I know the answer to this, but I'll just tee you up to hit it out of the park. Why? What was the key or several keys to seeing that happen in three to five years, which is, again, a relatively quick turnaround given where the company was. What was the key? Well, the key was having good intent. My passion for this experience was to use it as an opportunity to prove that servant leadership could drive superior competitive results in the marketplace. So we started with that daring destination that I described, and we also started with a

heart for serving those franchise owners well and performing as they deserve the business to perform. And so our bravery around the goals and our humility around being for those franchise owners, more so than for ourselves, I think, gave us the impetus for a stunning committed group of employees to that turnaround. We knew why we were doing it, and we knew it was important to accomplish on behalf of our owners. Well, I love this because this leads us right to the book, obviously, how to drive superior results by serving others is the subtitle. So what did it look like when you say, all right, we're going to serve these franchise owners, and as a result, we're going to drive results through the service. We've all heard servant leadership before,

certainly not a new idea, but this is the first book written in a while from a CEO's perspective where this philosophy turned into methodology. I just love for you maybe to share a few of the methodologies or strategies or policies that came out of this commitment to, we're going to serve these people better than they've ever been served. What did that look like on the street? What are some things that you can think back to and go, can this move the needle here? This moved it over here, and it was all a function of serving our team. Well, the day that we decided that we would measure our success in the corporate office by the same metrics as the franchise owner was the day we started getting our mindset on the

right track. In the franchise business, often the small business owner, the franchisee, is viewed as kind of an opinionated, emotional small business person. And maybe the corporate offices, we're getting tired of listening to them. Instead, we said, no, we not only listen to our owners, we respect them, we might even say we love them. So let's talk about that. I'm talking not about love the feeling, talking about love, the action verb. What would it look like to love your franchisees? Well, one of the things that looked like was collecting data. Now, that may sound weird, But if you don't know anything about the performance of the restaurants, how on earth could you measure performance for your owners? We had no profit statements on our restaurants at the beginning.

So the first thing we did was collect that information so that we could sit in the room with a franchise owner and say we truly did understand where their business stood. And we could truly measure the impact of our programs on moving forward their profitability. A second thing it looked like was listening. Not only did we do a listening tour at the beginning for broad feedback, but we met with our franchise leaders, a group of 10 individuals that had been elected to represent the franchise owners. We met with them every single quarter for three days in a conference room, writing on the blackboard, what are the challenges in the business, and how can we work together to solve them.

Many of our franchise owners would tell you it had been a rare day where they actually had that opportunity to share what's wrong and I have some ideas about how to solve it. So listening, I would tell you there was an important positive tension between listening to the feedback of the franchise owners and having the data in the room for that conversation because I love passion but I also love facts. and the facts are our guardrail on our emotions. So we would welcome the emotional, passionate speech about what needed to be done, and we would guardrail our decisions by the facts on how well those decisions serve the owners. And that proved to be a strategy that had huge impact on our performance. I don't want to get too far off track here, but I really want to know, how does the public begin to see all these changes?

Because you just described early on in our conversation, where the business had fallen to, well, that's as a result of people not coming in buying chicken and biscuits and everything else. And so when you begin to make these changes and you saw results in three to five years, I'm just curious how quickly customers begin to see the different. And when you're talking about all these things that we want to do better, we've got data, what causes the public to start to wander back in at a higher rate? Well, the way we talked about our brand was entirely new and different. We worked on that, also together with our franchise owners.

The very first thing the public saw is we renamed the concept Popeye's Louisiana Kitchen. It had historically been called Popeye's Chicken and Biscuits. We felt that the heritage of Louisiana was such a wonderful platform for the brand to tell the story of our history and the amazing food that comes from Louisiana. So the first thing they saw was all new packaging materials and brand new advertising materials and brand new advertising that told the stories of Louisiana that made their mouth water for our food. And it didn't take long with that combination of the great stories

and the great food to bring people back into the restaurants. All right. Now, I want to keep going where we were talking just a few minutes ago, the idea of, okay, we're going to serve single-minded focus on serving. And a big part of that was serving the entire organization the people by driving home, hey, we've got to know our why. Individually as team members in the role that you're playing, know the why of your team that you're a part of, and then, of course, the organization's why.

Was that something that was hard, Cheryl, to kind of drill into a culture that, again, existed before you got here and here you come in, new CEO, and you're driving this. I'm just curious how that was received, this focus on everybody knowing their why. Well, it began with the leadership team of Popeyes deciding what we thought the purpose should be for the organization, and we landed on these words that the purpose was to inspire servant leaders to achieve superior results. It was the combination of our heartfelt servant leadership with performance. We felt that servant leadership had no credibility without results. So we partnered those two words, serving and performance. We then said there are six principles we believe are critical to it. You've heard me talk about some of them already. Passion was incredibly important to hear the passionate belief in our brand and the future opportunities. Facts were incredibly important to our decision making.

Listening and learning continuously was one of our principles. Coaching and developing our people, being personally accountable, and always valuing humility in ourselves. were our six principles. But interestingly, our people looked at that plaque, and they said, that's nice, what a pretty plaque. And we put it on our walls, and everyone looked at it lovingly. But what we quickly learned is no one was inspired to be a plaque.

You know, a lot has been written now more recently about purpose-driven companies, but they tend to be plaque-driven. There tends to be a piece of marble. or a lovely framed picture of the plaque somewhere in the building. But what the people tell you is they want to be the purpose and principles of the company. And when you think about it, they are. The people in your organization are the only purpose and principles anyone ever meets. So what we began was something entirely different.

And frankly, I've never heard of it done. We created a class called Journey to Personal Purpose. and we taught it to every one of our employees in the office and the field and eventually to our franchise owners and our restaurants. Because we found that when you unlocked for a person their personal purpose and let them express their personal principles at Popeyes, it unlocked incredible commitment and enthusiasm for growing Popeyes. And that's what we experienced is people came to an expression of who, they were and how they wanted to commit to Popeyes, we saw incredible engagement and performance. It really, you know, when you're excited about why you come to work, you perform.

Yes, that's right. I love this. I think this is fantastic. I've not heard of a company doing that intentional class like that. And I also want to stay here for a moment because I'm guessing, correct me if I'm wrong, I'm guessing that the intentionality of that class and the philosophy and the methodology driving all of that Also, in a positive way, without having to root people out and be a Gestapo, if you will, walking around looking for people to get rid of, I think it probably pushed a lot of people

out the door who just realized this isn't the place for me. Is that true? Well, it certainly let people know that we were interested in getting to know them better, and we wanted them to bring their whole selves to work. And that's a degree of vulnerability and transparency that not all people are comfortable. And I will tell you, we didn't have 100 percent adoption because there were some people just totally not willing to reveal more about themselves. Frankly, they were the losers in that because when you're transparent with others, when they know you well, you play better with those people on the team. Your supervisors are able to better position them for success and jobs and offer them better opportunities. I mean,

all boats rise when we're transparent with one another. So I think for the majority, of people, they found it an amazingly uplifting experience to do this, although early on maybe a little bit scary. One employee said to me, he said, I don't think I've ever worked anywhere where it was safe enough to really let you know who I am. So I do think the leaders have to create an environment where people can feel safe, telling you about their life experiences, sharing their deepest, most personal values. expressing their strengths and where they might be the best contributor to the organization,

the leaders have to be willing to be on receive and create an environment where people go, you know what, this is going to help advance our cause by being more transparent with my leader. So over time, that became truer and truer. We asked people to share their personal purpose, either in small groups or even a large company meeting. and I'll tell you what, we really got to know one another at a whole different level. Oh, I'm sure. Curious to know how soon you got intentional with your actual franchisees. The first part of it, it feels like you're trying to serve them and show them,

hey, there's new leadership here that's intentional to help you win in your business. But did it trickle down to them or how intentional were you in that trickle down of helping them be servant leaders in their stores? not just receiving a new style and real substantive servant leadership for their benefit. What were you doing there to help them as franchisees all across the country go, oh, man, this servant leadership stuff actually works. I need to be doing this as well. Well, first, you absolutely have to live it because the only way people become curious about servant leadership as a path to performance is to see it in the daily relationships

and decision making of the team. And frankly, we had to live it for quite some time for trust to build. These franchise owners had seen four CEOs in the prior seven years and four leadership teams with those folks. And so it took a while. One of my franchisees was honest enough to say, you know, Cheryl, we're kind of like foster children. And you're just a new foster parent. So don't expect us to trust you soon. And I appreciated it as candor because it reminded me that it would be a long,

steady process of us really living these values and being consistent to them that would cause trust. Once trust came with our franchise owners, then their genuine curiosity in adopting these same values and principles for their own companies happened. Franchisees are independent small business people. They really create the own purpose and principles for their companies. So we could not have authority over them. We could only have an influence. I actually prefer that as a leadership approach because influence is so much more real and genuine and sincere than authority.

So over time, I think they were influenced by our convictions and the trueness of them and our actions and became curious as to how they could become adopters as well. And just like you would expect, we had early adopters that became passionate about servant leadership quickly. And then we had late comers to that dance, who it took much longer, as you would expect with a group of human beings. Yeah. Is there a delineation between the early adopters than the late adopters? Do you see the late adopters while they may have taken a lot longer to jump in? Once they jump in, they're a little bit more gung-ho?

Or is there any difference? Well, you know, an early adopter is a risk-taker. And an early adopter is willing to look at themselves in the mirror and say, how must I change to better lead my organization? One of our franchisees named Mark literally went back, sat down with his supervisors of his restaurants, and said, I realize I need to change for our performance to be at a higher level.

And his people exploded with ideas on how to structure and train and change to create better performance. And he was so shot at how fast his people responded They said, you know, you don't come in the restaurant anymore with a clipboard and tell us what's wrong with us. You come in asking for our ideas on how we can make it better. And he was just amazed at the speed of the transformation in his company by the changes they saw in him. That's so good.

Okay, I got to park here for a second, Cheryl. You can run with this. But what you just described is so true, we as leaders cannot forget this. And that is when we're asking questions, we are. are passing ownership over to our team because they have, they're invested, because they get a shot, they get an opinion, they get a chance to shape it themselves, as opposed to this authority, this hard line, I'm the dictator. Boy, I tell you what, that is a huge, huge point to make. People will respond. They will engage because they have something invested many times if it's just

their opinion. Absolutely. And there's a second part of that that I think is so important. I learned is from our people leader, Lynn, who said the only way people learn is through discovery. So the best coaching you can do for them is to ask them a question that leads them on a journey to discovery. And in that discovery, they will find the nuggets of new truth that will drive change in them. So so often I think we see coaching as telling, you know, you come in the office and you get direction from your boss. It really should be you come to that coaching session and you are asked questions that help you move along in your understanding of the business opportunity or business situation.

That changed me forever. You don't even have to prepare much for a coaching session if it's all questions. It actually takes some stress off the leader. You just have to come ready to ask provocative questions out of your experience that will help that person move forward. That's good. Awaken your inner toddler. That's right. It's in there.

Nobody had to teach you how to ask questions when you were a little tight. Everybody can do it. All right, this is interesting to me. Because we started the conversation with you sharing how you had failed at Kentucky Fried Chicken, you take some time off. You'll learn a lot. You do some self-examination, discovery and all those things. You get another opportunity and it goes really, really well.

However, it was at an organization where I think you mentioned just a moment ago, like four CEOs in a small amount of time, if I heard you correctly, So lots of turnover at the top. I just think it would be wise for all of the leaders that are listening in here, those who are winning or on the path to winning big, to be very careful of what happened to Popeyes. And I'm just curious now that you've been there for so long, you've probably found out what was going on before.

What causes an organization like this that is a storied franchise and obviously a great business at one point? And then it can just fall into this spiral of going downward. what happened? And again, I'm not trying to have you in a position where you're talking negatively about the previous leaders. However, when there's that much turnover at the top, how do you guard against that happening again? Yes, well, that constant turnover leads to chaos and loss of morale because people lose track of what we're trying to accomplish. So first and foremost, I talk about the daring destination being well defined on one piece of paper that everyone understands. And let me tell

you a story about that because this just blew my mind. At one of our management meetings early on, we had put up on the walls, you know those meetings where you say, what's the most important problem to solve at Popeyes? And we had posted the post-it notes all over the wall and we had narrowed to the top ten things that needed to be fixed. in the organization. And I said, would you like to be the team that fixes these things? And a woman who had been at the company

20, 25 years, her name was Sandra, she raised her hand and she said, Cheryl, we put these problems on the wall every year. I'd like to be on the team that actually fixes them. Wow. And it took my breath away.

Our responsibility as leaders is to tackle the things that are between our teams and success, is to get everything else off the field that's distracting them from working on the most important things. I'll use one example. We had had slow speed of service and our drive-thrues forever at Popeye's. Everybody knew it. We were ranked 98 out of 100 chains on speed of service. The only way we survived is our food was so darn good, you would wait for it. But our team knew that if our name was Popeye's a quick service restaurant, we needed to be fast in our drive-through. They knew it would be hard.

We tackled it. We created new systems. We provided new equipment. We retrained our entire system. We set new goals and measured them. And we said, we're going to 180 seconds at our drive-through. That's industry fast. And we tackled that and accomplished it in a very short period.

period of time. And can you imagine the pride that welled up in the organization for actually knocking that one off the charts? You know, we did it. There was just a huge benefit to the enterprise of realizing how successful they could be if they just put their mind to it and tackled the hard things. That's incredible. That's like NASCAR pit crew fans. Yes, it is. I mean, it really is. That's really cool. Well, Cheryl, our time with you is almost done. And we've talked a lot about what's in the book. The book is, as you say, it's really two parts. The first half tells the story, much of which we have covered today and much more detail in the book. And then the back half is about challenging our listeners and the readers to become a dare-to-serve leader. I want to give

you the last word. What do you want leaders to take away when they read this book? Well, I really encourage you to use the 40 reflection questions in the book to bring your leadership point of view to bear because I don't want these to be my convictions. I want you, the leader, to develop your convictions about leadership and how to drive superior performance. I want to lead you on a journey to do that because until you know your convictions, you can't teach those to your team and lead them to phenomenal success. So my prayer for you is that you will spend the time refining your own leadership convictions and putting them to work for the benefit of your organization and your people. She is Cheryl Batchelder. She has done what she just challenged you to do.

The book is Dare to Serve How to Drive Superior Results by Serving Others. Cheryl, you have served us today. I know your time is valuable, but we are so very grateful for it, and I know that we're all better for this conversation with you. Thank you so much for being with us. Thank you. It's been a pleasure. She is Cheryl Batchelder. Hope you enjoyed that. The book is Dare to Serve, how to drive superior results by serving others. It would be a great read, and it's very, very applicable and very practical for you to start to integrate right away. Well, speaking of integrating things that work, how about creating core value,

something that we have done very well here at Entree Leadership and Ramsey Solutions. This tool is going to help you lay out your core. You'll see our full list of core values and understand why we chose them, how we live them, and how we lead with them. And then we'll walk you through how to create your own core values. And then we'll help you with how to communicate your core values once you've established them. How do you communicate them to your team? And not just communicate at them, but communicate to them and model these core values. This is such a valuable tool absolutely free coming to you from Entree leadership.

Here's how you get it. Text episode 269. That's episode 269. The numbers, episode 269, text that to 33444. That's 33444. Always love InfusionSoft and the resources they bring to you each episode. Today we're talking about growing customer lifetime value. Oh my gosh. Who doesn't want to do that? Well, there are 50 ways, no, more than 50 ways. But Infugersoft is giving you 50 clear-cut, easily to understand, easy to implement. That's right, 50 ways to wow your customers so that you grow your customer lifetime value. These are cost-effective ideas, so this isn't going to cost you a bunch of money, and it doesn't take as much as you think to wow your customers, to turn repeat sales and referrals from a addition game to a multiplication game.

Here's how you get it. Infusionsoft.com slash customer wow. That's infusionsoft.com slash customer wow. Or you can get the link in this episode. Show notes. Episode 269 at Entreeleadership.com under podcast and we've got the link for you. Well, that's going to do it. So on behalf of Will the producer, Tim the engineer and the entire Entree leadership team, thank you so much for listening. We'll talk with you again very soon.