Is this a good way to run a business?

[W.DeBord]

I've learned so much from all of you over the years. There's always issues and points I could never have thought of so I'm asking for your opinion on this issue, please?

Which is a better way to run your bakery? Example 1 or 2 and why or why not?

example 1: Lots of cheap employees (students, housewifes part timers) have everyone doing any task. Each person bakes, assembles, fills orders. I'm cross training employees to make my product.

I knew a really sucessful bakery the owner was the main baker. When he died the quality of their product and the popularity of the store crashed. I want to avoid that by not relying heavyily on any specific employees. My product isn't consistant but it pleases me. Although I work alot of hours to make up for what employees don't accomplish.



example 2: Key employees with assigned tasks. A head baker, people who assemble product, people that fill orders plus a few part timers to help customers.

I believe the key employees should cross train to be able to cover a sick employees position but over all they should be responsible for specific tasks day in and out. I beleive this will give me a more consistant product and people better skilled at these tasks. I'd be turning over some control so I'd have more time off but can I trust them? These people want to contribute to my product line. That scares me because when they leave I'll loose customers.


Which way would you run your business?

[phatch]

Example 2.

In example 1 ou're going to have more turnover in part-timers and wage slave types than in skilled dedicated employees. Youre going to spend a ton of time on training and waste rates will be high.

In example 2, you have time to live, not just work. You create desirable employees who may move on, but your reputaion and quality training will be desirable recruiting tools for high grade though unskilled employees. Cross trained employees can fill the temporary gaps and quality won't suffer until staffing is returned to normal levels. With talented employees who want more responsibility, instead of losing them you gain a "franchise" in a new location, if you want to expand.

Phil

[phatch]

Another thing. I've worked with enough 2nd income spouses and wage slaves in those sort of example 1 businesses. I won't do business with those places as quality is as bad as it gets, and I don't want to support those business practices either.

Phil

[kuan]

Peter Lynch once said that the best business is one which any idiot can run. He seriously considers simplicity when picking his investments.

Example 1 is a horrible example of how a small business can quickly turn chaotic when too much presure is put on having to supervise, train, and retrain employees. Too much time is spent on hands on management.

Example 2 looks better if all goes well. It's self managed and more or less automated by human intelligence. But you better have contingency plans just in case one link in the chain decides to self destruct.

This is not to say that example 1 can't work. Example 1 will work as long as the operation remains small enough and the owner/operator remains dedicated. Many Asian restaurants operate this way, with the owner present at all times and assigning tasks as the situation deems necessary.

Economics of scale dictate that example 2 be large enough for that model to work. Costs will be higher because of the safeguards you need to install. These may be as simple as placing some ads in the local paper or as complex as maintaining an automated inventory tracking system. But when it comes together it's pretty awesome.

Kuan

[fodigger]

Example # 2 for me please. Happier , more fulfilled employees translates to a better, more consistant product. If they want to add to the line great. Have them write the recipe down and then you make it to make sure it works. Add it to your catalog of recipes. Might be that you have to tweek it alittle to bring it up to your standards. Bring them along explain why you are doing it so they feel part of the process. Part timers are for the birds turn-over is great so you spend way too much time teaching the basics over and over. In your example #1 what did the baker leave when he died? A soon to be failing business. If I died today my restaurant would be around as long as my wife wanted it to w/o missing a beat or so the plan goes.
Just my thoughts and what works for me.

[chrose]

I ran the decorating line for one of the largest gourmet dessert companies in the US. When it was started it was less than 5 people. The head mixer is now VP in charge of Production. A VERY large task, the head baker is now President of manufacturing. Several of the women who started as decorators are still with the company. The point is they were permanent employees in a very small operation which grew. As it grew, they grew and took on new responsibilities. Everybody could do every job. There (in my opinion) needs to be a core group that will be loyal that can grow with the company. If you have high expectations for the bakery and plan to grow it, let them know and let them know their potential future. There are plenty of non key roles (that are none the less important) but are not skilled and easily filled by temps, students, etc.
I think you know the answer and letting go of the reins is difficult I know, but you can't do everything as you know. Hire people and groom them and let them know there's a future and I think you'll be pleasently surprised. Face it the world is not made up of all bosses, there are many loyal people who would bust their asses for you because they feel a pride, an ownership in the comp[any but don't want to run it. You get the best of both worlds. Can you trust them? Of course. The richest business people are successful because they do it all the time. Give them direction, delegate and gently push, prod, pull back and respect them as necessary and I think you'll be fine.
Any other questions pertaining to mass production, feel free to ask, I did it!

[Devotay]

Yep, ex. 2 is the way to go. Not just because of the freedom it can give you to live your life (though that is a big deal) but also because you must remember your other customer - the one who will one day buy your business. If it looks like the bakery revolves around you, then it has no value to the person who might one day buy it. Unless you are darn sure you will leave it to your kids or something (very rare these days) you must consider the business' resale value and make it able to function without any one key person.

Hi W.DeBord,

If I understand your 2 examples, guess I'd choose example number 3:

The road to quality has no finish line. Please don't compromise consistency. (Probably you're most important product.) A product that is not consistent may please you, but might not please a great many of the customers you may loose because of this fact!

Assign a "key" person to assume control in your absence; and trust that person to act on your behalf.

Concerning letting your people contribute to your product lines: don't be frightened or scared! Listen to their ideas, try them out and if they work out sucessfully, offer a BONUS to them for providing you with a money-making addition to your overall operation!

Best of Luck:

[ShawtyCat]

You know...if I didnt know who I was Id swear that was me.

BTW: your example #2 is the best way to go...the quality of your product will suffer with example #1 and you will probably be spending most of your time focusing on your high employee turnover and training. Definately go with example #2.

Jodi