Restaurants Tap Labor Productivity Analytics to Identify Best Workers

As restaurants continue to face labor challenges, many are using new digital solutions to get smarter about how they tackle the issue, quantifying productivity for more effective incentives.

Michael Lotz, director of operations at Callie’s Hot Little Biscuit, a biscuit business with restaurants, a food truck and a retail business, spoke with PYMNTS about how the brand uses labor management software to boost efficiency across stores. Lotz noted that, by being able to get more granular data about labor and productivity, he can more effectively identify what is happening in the brand’s eateries, backing observations up with hard numbers.

“I can [now] lock down labor percentages,” Lotz said. “I can make my general managers responsible for their labor costs, and they can see it in real time. So, it’s really helped us from a bottom-line standpoint, saving money.”

The brand leverages SpotOn’s Teamwork software suite, announced earlier this month, using its scheduling management features to understand where more staffing is necessary and where the restaurant can get by with less.

Additionally, Lotz noted that the system can enable more targeted bonusing initiatives. By presenting information about productivity in an easier-to-access, unified way, the brand can reward general managers on a regular basis based on data about labor percentages without prohibitively complicated, piecemeal calculations.

Moreover, Lotz noted that the technology has also been boosting efficiency not only when it comes to the meta-level productivity insights but also in saving time on tip splitting calculations.

“[We] use the tipping procedure and do hourly employees and break everything up [automatically] instead of having to go in and … do the math,” Lotz said. “That was huge for us.”

These kinds of labor-saving initiatives can be essential for restaurants when it comes not only to mitigating costs but also to driving sales, given the effect that staffing levels can have on consumers’ experiences (and consequently their likelihood of returning).

According to data from the 2022 edition of PYMNTS’ Restaurant Readiness Index, which drew from a survey of more than 500 managers of quick-service restaurants (QSRs) and full-service restaurants (FSRs) across the country, nearly one in three restaurants reported that their level of service has decreased as a result of staffing issues.

Read more: More Than Half of Restaurants Depend on Digital Sales, Despite Uptick in On-Premises Orders

Additionally, the same study found that nearly half of all restaurants faced hiring and retention challenges, and 28% of restaurants have implemented new technology to cope with these difficulties.

In addition to tools to offer greater insights into productivity, some restaurants have also been looking to automated solutions from artificial intelligence (AI) order-taking technology to back-of-house kitchen robotics.

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Lotz, for his part, noted that in addition to these labor management tools, the implementation of a point-of-sale (POS) system that is easy for employees to learn and that is integrated with other restaurant systems has also been a great help, as far as efficiency-boosting technology is concerned.

“One year from now,” Lotz said, “I would hope that we would be having a conversation about how I have shaved 5% to 7% of my bottom line through the use of the technology that I have.”