Topgrading

A lot of companies are getting killed in the recession, but this article shows how Topgrading can produce record sales and profits even in a recession.  The company happens to own restaurants, but the Topgrading principles apply to all industries.

K & N Management, owned by Ken Schiller and Brian Nolen, owns Rudy’s Country Store and Bar-B-Q franchises in Texas.  As Marlis Oliver, Chief Operating Officer put it, “We were continually losing A players and retaining C players way too long.  As a company, we were frequently understaffed and we often re-hired C players.  Continuing to mis-hire and hold on to “dead weight” resulted in inconsistent products and service, accounting and theft issues, and personnel policy violations.”

While traveling, Ken saw an article about Topgrading in a business magazine, and was intrigued.  They were looking for a turn-key plan to hire better; Topgrading offered a turn-key method to get all managers in the company interviewing, evaluating, and coaching the same way.

Ken said, “We love that Topgrading is a systematized and thorough process.  The book is not just theory, it outlines a step-by-step approach to make it happen.”  The decision was made to make Topgrading their company focus in 2006.  The initiative was kicked off with a workshop for all managers.  The managers read the bestseller, Topgrading, together over a span of twelve weeks, and then as teams they determined how the key elements of Topgrading would be implemented.  Every manager helped tailor Topgrading to the company, and once a system was decided upon, it was mandated.  Ken Schiller said, “You will mis-hire people if you don’t follow the system, because it is so easy to cut corners.  Create the system with input from your team, put metrics in place to motivate people to follow the rules, and consistently monitor progress.”

The Topgrading system that was implemented included creating Job Scorecards for all positions, conducting Tandem Topgrading Interviews for all management hires and promotions, conducting Topgrading-based interviews for all hourly employees, checking references (arranged by candidates), and conducting biannual Talent Reviews.

Ken, Brian, and Marlis estimate that prior to Topgrading approximately 25% of their managers and hourly employees turned out to be A players.  Now, 92% of managers and 80% of employees are rated A players. Business results have been equally impressive.

Oliver said, “We have experienced phenomenal sales growth.  Our Rudy’s restaurants have the highest sales of restaurants in the Austin area when comparing food-only sales volume and our stores also outperform others in the Rudy’s system.  As a result of implementing Topgrading, we are experiencing sales growth, profitability, and nation-wide recognition for our products and services.”

Another key to the success of Topgrading at K & N Management was the creation of a new position, Topgrading Director.  Danielle Robinson was hired to do that job, and her main responsibility is managing talent for the company.  She has been using the Topgrading Career History Form to screen management candidates for about a year, and said, “I love the Topgrading Career History Form.  I get so much more detail about a person than what is included on most resumes, so I know if they will be a fit for our company before even talking with them.  I get insights into the candidate before interviewing them, so interviews are shorter and more productive.”

K & N Management has continued to grow by creating a new restaurant concept, Mighty Fine Burgers, Fries, and Shakes. (www.mightyfineburgers.com).  The first location was opened in 2008, and locations have opened in 2009.  All new restaurants have exceeded expectations, and the management team attributes much of the success to Topgrading. Robinson said, “We already had great people management systems in place at our Rudy’s stores, so we just had to implement them in the Mighty Fine restaurants.”