How In-N-Out Almost Became McDonald's

I go to In-N-Out Burger a lot.

The law of averages suggests I should have had a bad experience at least once by now. Some visits have been better than others, but I’ve never had a bad experience. Not one.

I’m not alone in my admiration of In-N-Out. They’re consistently ranked among the top fast food chains in customer satisfaction. The chain only has locations in a handful of states, but people all over the country and even outside the United States have become fans, with some devoted followers even planning a business trip or vacation itinerary around a visit to an In-N-Out. 

What’s the secret to In-N-Out’s success? It may be easier to understand if you compare them to a similar restaurant that struggles with customer service: McDonald's. 

The two have a lot in common. While McDonald's has a more diverse menu, both are fundamentally fast-food burger joints. Both were founded in Southern California in 1948. Many fast-food service concepts in use today originated at either In-N-Out or McDonald's. The two companies even use the same three words as a foundation of their operating principles: quality, service, and cleanliness.

So why is the customer service experience at these two restaurants so different? In a word, culture. Culture defines everything these organizations do when it comes to customer service. 

In-N-Out founder Harry Snyder made sure the principles of “Quality, Cleanliness, and Service” were more than just platitudes. He instilled them in everything the company did – and these principles are still present in everything In-N-Out does today. Their food is fresh, not frozen. Their stores are clean, even during busy times. Their employees are friendly and well-trained. In-N-Out has maintained their remarkable consistency by steadfastly refusing to franchise their stores and resisting the urge to expand too quickly.

Culture also shapes many of their business practices, such as hiring employees. In-N-Out’s management believes a high-caliber employee is necessary to provide the service and quality they know their customers expect. They offer better wages and working conditions than their competitors which contributes to one of the lowest employee turnover rates in the fast food industry.

When Ray Kroc purchased the McDonald's concept from the McDonald brothers, he focused on rapidly expanding the business. The words quality, service, and cleanliness were clearly less important than a growth strategy based on volume, cost control, and franchising. For example, their frozen burger patties are cooked in approximately 42 seconds using a special clam-shell grill that cooks both sides of the patty at the same time. This is a remarkably fast and inexpensive way to cook burgers, but it may also be why McDonald's finished last in the 2010 Consumer Reports fast food burger rankings. (Yes, In-N-Out was rated #1.) 

While franchising allowed McDonald's to grow into a global giant, it also made it difficult for the company to control the quality of service delivered at its restaurants. Today, approximately 80 percent of their restaurants are run by franchisees and only 20 percent are run are by McDonald's, Which means the service customers receive from most of its establishments is determined by the management skills and customer service philosophy of an independent franchise owner rather than by the McDonald's organization. 

Of course, there are exceptions to every rule. Culture isn’t exclusively defined by an entire organization. Even at McDonald's, stores with managers who are good at engaging employees and motivating them to deliver outstanding service typically bring in 10 percent more revenue per year than the average.

 

Learning Point:

Values alone don’t define your culture. It’s what you do that counts. For another terrific example, read how Phone.com is operationalizing their values to turn them into action.

 

How to Hire for Culture Fit

There are two employees almost every customer service leader has had.

One employee has crazy talent. She has all the skills you could ever want and a resume a mile long. She’s also a pain to work with. Customers sometimes complain about her attitude.

Another employee is a little lighter in the skill department. He needs a lot of training, but he’s a natural problem-solver and a quick learner. Customers love his can-do attitude. Co-workers love his teamwork.

Who would you rather have on your team?

Most of us would prefer the employee who fits our culture over the highly skilled, but highly difficult employee.

Here’s a guide that can help you find more of those people.

Step 1: Define Culture

Imagine what the world would be like if there were no shoe sizes. You would walk into a shoe store and be completely unable to tell the salesperson what size shoe you needed. The only way to find shoes that fit was to try on pair after pair until you found one you liked.

Pretty tedious, right?

Hiring for culture fit without a clearly defined culture is the same thing. It’s pretty difficult to find something if you don’t really know what you’re looking for.

So, what is culture?

Culture is what we do. And, what we do is shaped by all the signals around us. Some signals are good and point us in the right direction. Some signals are bad and distract us

You can fix this by creating a customer service vision. This is a shared definition of outstanding customer service that serves as a compass to point everyone in the right direction. You can use my customer service vision worksheet as a guide. 

 

Step 2: Create an Ideal Candidate Profile

An ideal candidate profile describes the attributes of an employee who is most likely to be successful in the job. It combines the skills they need to do the work with the qualities they must possess to fully embrace the customer service vision.

You can use this handy worksheet to help you.

The key to this exercise is narrowing down your list to just a few must-have skills and attributes. The more must-haves you add to the list, the harder it will be to actually find a person who fits.

Check out how Shopify boiled their ideal candidate down to a simple concept in this cool video:

Step 3: Develop Tests

The last step is to devise ways to determine if a job applicant possesses the attributes they need to be successful.

Think beyond interview questions here. How can you get concrete evidence that they’re a great fit?

Here are a few examples:

A technical support team asks applicants to respond to a customer email. This allows them to test the applicants’ resourcefulness (the answers are on the company’s website) along with their communication and customer service skills.

The parking department on a college campus deliberately neglects to offer directions to their office when they schedule interviews with job applicants. They rely on applicants to either be assertive enough to ask or creative enough to figure it out on their own. An applicant who arrives late for an interview because they couldn’t find parking is probably ill-suited to helping customers navigate the same obstacles.

 

Additional Resources

Whole Foods, Southwest Airlines, and Zappos are all known for outstanding service and strong cultures. Check out the hiring page for each company. They all focus deeply on culture fit. 

Anatomy of a Lousy Survey

This blog has spent a lot of time on surveys lately. 

There's a post on how to write a great survey with just three questions. There’s another post on five ways to capture VOC data without a survey. You can even read about five signs your survey may be missing the point.

This post focuses on that last topic by giving you a detailed breakdown of a lousy customer service survey from Buffalo Wild Wings.


Tip: You’ll get more survey responses if you make it easy for people to respond.

Here’s the survey invitation. There’s no QR code and the survey site itself isn’t optimized for mobile, so guests are discouraged from completing the survey on their smart phones.


Tip: Don’t bother your customer with questions you should already know the answer to.

The survey asks a lot of questions that could easily be tied to the survey code or a customized survey link. Examples include the store, date visited, and the time of day. Each of these questions are on a separate screen which makes the survey even more tedious. 

So far, we're at 8 screens:


Tip: An annoyingly long survey will remind customers how annoyed they were already.

This survey is tedious! Customers don’t have the opportunity to share any feedback until they reach the 15th screen.


Tip: Cut out extra questions and give customers a comment box instead. 

The survey also assumes it knows what’s driving customer dissatisfaction. The question in screen 15 (above) asks customers to provide an overall rating. The question in the screen below (screen #19 in the survey!) presumes to know what might drive customer satisfaction.

The danger is these questions might be irrelevant to the customer, but they're required to complete the survey.



Tip: Keep questions to a minimum by avoiding repetition.

By now, the questions are starting to get repetitive. Didn’t someone in marketing check this survey before giving it the green light?

Here's the question on Screen 15:

Overall, compared to your expectations of what a restaurant can and should be, how would you rate your experience at Buffalo Wild Wings?

Here's the question on Screen 26:

Compared to your expectations of what a restaurant can and should be, how would you rate the Buffalo Wild Rings you visited on providing you with the "ultimate social experience for sports fans in your community?"

Screen 26


Tip: Surveys should have a single purpose to give them razor-sharp focus.

The questions just keep coming! Buffalo Wild Wings really makes you work for that $5 coupon. Now, they want to gather some demographic data.

It looks like someone in another department said, “Hey! You’re doing a survey? Can I add a few questions?” This is the 35th screen.


The final tally on this survey was a whopping 39 screens!

The effort required to complete it is a big turnoff. Here’s an example of a survey that’s far easier to complete. It’s limited to just five questions and customers are giving two options to access the survey.

(Please excuse the blurry picture.)

Note: My personal policy is to share negative feedback privately before naming a company in a blog post. Members of my party (including me) attempted to share our feedback with the store manager but he refused to come to our table.

In this case, I'm grateful for the poor service we received since their survey provides an excellent illustrative example.

Service Failure Interview with John Ippolito

John Ippolito invited me to be a guest at the Carte Blanche San Diego Book Club a few months ago. We recorded a brief interview where I shared a few thoughts about my book, Service Failure.

  • The customer service disconnect - companies think they're doing well when they're not
  • The process of writing the book
  • How Service Failure is different from other customer service books

You can view the interview here: