What is your five percent?

I just finished listening to Unreasonable Hospitality by Will Guidara. As a fan of all things behind the scenes in the culinary world, it was an excellent listen to hear how things work in a fine-dining restaurant. Throughout the book, Will does not shy away from the challenges and failures while going from the 50th place on the list of the best restaurants in the world to the first. Many excellent management and teamwork lessons can be learned and applied to any business. Will and his team have an educational and consulting practice to enable this idea. I highly recommend the book and, specifically, the audiobook; stay to the VERY end for a bonus.

A concept in the book struck me: the “95/5 rule.” In this book portion, Will discusses the balance between being “restaurant smart” and “corporate smart.” Restaurant smart means being focused on hospitality and providing exceptional experiences. Corporate smart means focusing on the processes, negotiating, and budgeting to keep your restaurants in the black. Either approach can produce similar results. This dichotomy is similar to my article on how processes can hamper innovation titled “Risky Business”. This is where the “95/5 rule” comes in. I tend to bristle at anything titled a rule, but let’s go with this for a moment.

The “95/5” rule states that 95% of the budget and operations fall under the “Corporate smart” way of thinking—close scrutiny and approval processes to ensure efficiencies are gained. The other 5% is spent “foolishly.” In the restaurants Will managed, this was about not crushing the creativity that made the restaurant a destination in the first place. It provided ownership to the staff to do what they thought was right in the moment. Now, I laugh when I think about going to a finance team and saying, “I plan to spend 5% of the budget foolishly!”. It sounds like an SNL skit that didn’t make it to air. The emphasis isn’t on the foolishness. It is the freedom to act in the best interest of the company at the moment an opportunity or idea appears.

There are a few things to note. First, the only way that this concept worked was that there was clear communication from the top to the bottom so that the corporate thinkers and the restaurant thinkers were all on the same page about what was good for the company. This was primarily accomplished through a mandatory 30-minute shift meeting. Sidenote: Will's goals for that meeting are inspiring and full of ideas I am stealing. Second, this communication enabled a superpower for Will; these experiments or ideas would be discussed at length. Situations that seemed likely to happen often would have the idea systemized and built into the 95%. Trust me, listen to the book. Will is the narrator, and his energy is infectious when discussing this.

Creating something as a rule, etched in stone, is a fragile way of thinking. Based on some of the things they did at Eleven Madison Park, some had to be over the 5%. During lean times, the five percent got smaller. But I now have a new question in my arsenal to help a business grow by challenging the status quo.

What is your five percent?

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