Out of Chaos, came CHART

The Beginning of CHART ... as I remember it
by
Walter F. Hiller, SPHR
Member since August 1971

Background
I first met Chet Hall, our founding father, forty years ago when he was the Educational Director for the National Restaurant Association (NRA). In retrospect, I can only imagine what might have been going through his mind. Chet was in a position to observe what was happening regarding the state of training in the hospitality industry. I believe Chet’s assessment at that time could be reduced to one word...Chaos! Now, some may say that is too strong a characterization, but a review of the definition of chaos does include the concept of (1) confusion and (2) formlessness. So, our story begins this way:

In the beginning...there was chaos!
On a dark and dreary night in the Fall of 1970, Chet Hall, our founding father, was probably working late in his office at the National Restaurant Association when he encountered a vision. What he may have seen in that vision was 1) confusion about the perceived cost/value relationship of training, 2) a general lack of consistency regarding the acceptance of training, 3) variable levels of program quality, and 4) few measurable formats to evaluate the success of any given training program.

In his vision, Chet, who was at that time Educational Director for the NRA, might well have seen a few large multi-unit organizations that were making a serious effort to develop and maintain their managers and employees. He would have seen large foodservice organizations that could afford training programs and perhaps even a Training Director but were not convinced that formalized training programs would do any good given the high turnover in the industry. He would also have seen opportunities for many smaller foodservice organizations that could benefit from formalized programs, but with little or no training budgets, they had few or no programs.

In his vision, Chet also saw a need to extend food service training programs to hotel organizations as well, since many of them offered more than one restaurant option. As a result of this visionary experience, Chet decided that it was time to do something about it.

Action Plan
His action plan was to contact several well-established restaurant and hotel organizations and ask their personnel executives to attend an exploratory meeting with the purpose of discussing opportunities to improve the state of training in the industry.

This group of personnel executives agreed with Chet's assessment of the industry and offered to support the creation of an organization to address the issue of training in the restaurant and hotel industries. They agreed to send training representatives from their companies to attend an organizational meeting scheduled by Chet.

Conference #1 Chicago, IL, February, 1971

Among those attending that meeting was Bob MacKinnon, Corporate Personnel Director at Howard Johnson's. At the time, I was the Southeast Personnel and Training Manager with an indirect reporting relationship to Bob. Upon his return, Bob asked me to be the representative for Howard Johnson's.

Conference #2 Queen Elizabeth Hotel, Montreal, Canada, July 1971

My introductory CHART conference had no more than ten members in attendance. The agenda was devoted primarily to organizational issues such as deciding what kind of an organization we wanted to be, how often we wanted to meet, and what information we were willing to share. Chet was elected president, a name was selected, and by-laws were adopted.

At that time, I did not know just what impact that first meeting would have on my career. What I do remember is (having never been to Canada before) thinking “what a great organization this is going to be!”

I do have one vivid memory from that conference regarding the selection of a name. During that discussion, one person suggested we call ourselves the Council of Hotel and Food Service Trainers. Ultimately, we decided that name would not pass the acronym test!

Because Howard Johnson’s had yet to centralize its training function, my role at the second conference was to listen, take notes and submit a report to Bob MacKinnon regarding what was going on in the industry.

The following information is taken from my report to Bob MacKinnon and summarizes the first CHART presentations. This is probably the oldest CHART-related report in existence.

Summary of the First CHART Presentations

Subject:  Current Training Programs in the Foodservice Industry (1971)

At the Montreal conference (July 12-14), the following companies discussed their current and future training programs and activities.

• Holiday Inn’s – Tom Johnson, Director of Resident Training

Holiday Inn reported a total of 115,000 employees of whom 35,000 were company employee’s, and were developing programs in 10 training categories:

• Innkeepers School (two week management training)
• Food and Beverage Directors (Assistant Innkeepers)
• Inn Hosts (Desk Clerk Training)
• Housekeeping’s Training
• Maintenance Engineer Training Program
• Travel Park Management Training
• Dining Room Hostess Training
• Innkeeper Development Program (Skills Development)
• Products Division (Various Programs)

A corporate objective of Holiday Inn was to have 3,000 properties by 1980 with a quarter of a million employees. In anticipation of this growth, a decision was made four years earlier to crate Holiday Inn University. This university, a non-profit organization, was scheduled to open in July of 1972. It was a 4.7 million dollar plant that had, among other things, a three channel $150,000 color television system. The Holiday Inn Franchise Association played a key role in funding the university by accessing themselves one cent per room per night for a total of $650,000 per year.

Holiday Inn was conducting 10 management training programs per year with an average attendance of 45 per class. In addition, they held seven management conferences per year with an average attendance of 200 to 300 each. The capacity of Holiday Inn University was 300 students with major emphasis of first and second level management.

Whatever profit generated from operating the school was to be set aside to establish a scholarship fund for the dependents of Holiday Inn employees who could be awarded $1500 scholarships to any school of their choosing.

(Note: Shortly after it opened, CHART held a conference at Holiday Inn University and those of us who attended were completely blown away with their state of the art technology and the organizational support given to the importance of training their managers and employees.)

• Dobb’s Houses – John McClendon, Training Manager 

Dobb’s Houses were involved in three areas of food service, i.e. airline catering, airport restaurants, and fast food operations. Their volume was about equal in each of these areas. Dobb’s Houses based their training on the philosophy that training is a line responsibility and the failure of a manager to train his employees is grounds for discharge.

Each operation unit had a designated trainer who was a key supervisor or a lead person who had been trained to use the four step Job Instruction Training method.  As an incentive, each trainer in a unit was paid $25 a month. In larger units where a shift level trainer was needed, this individual was paid a deferential of ten to fifteen cents per hour while conducting training. The training cycle for hourly workers was three days and their entire training program was audited on each visit of an operations manager. 

• Hilton International – Henri Blanc, Director of Training

Hilton International had just centralized their training operations and had recently appointed Henri Blanc as Director of Training. All Hilton International Hotels were to receive instruction in the J.I.T. (Job Instruction Training) techniques and ultimately each hotel would become an individual training enter. In addition to this, a Career Development Institute was established at the Queen Elizabeth Hotel in Montreal, Canada and served as a central training location for department level supervisors and up. The Career Development Institute had conducted fifteen classes to date with each session lasting six weeks.    

In the near future, a training coordinator was to be appointed in each hotel to coordinate hourly training programs. Hilton International also stressed the philosophy that the training coordinator does not train and that training is a line responsibility. Therefore, each department designated an employee trainer who performed the actual instruction.

For the benefit of their out-of-the-way units, a “Book of the Month Training Club” was established to serve as a circulating library of management information. 

• Sky Chef’s – Phil Gibson, Director of Management Training

Sky Chef’s was a subsidiary of American Airlines. They had established a waitress training program to increase sales by 8%. This program was based upon the J.I. T. philosophy.  Sky Chef’s conducted training for all new units and they planned to install a Management by Objectives system corporate wide in the near future. Their turnover rate at the management level was 25% annually.

• Marriott – Marty Harder, Training Manager

Marriott was in the process of developing a new management training program to reduce their annual trainee payroll, which was one half million dollars. Marriott was running a fourteen week management training effort. Their new program will be set up first for their hotel divisions, whereby the training cycle will be reduced to approximately seven weeks.

In setting up the new program, Marriot studied the job of Hotel Management and found that it could be divided into 108 learning units, 45% dealing with food and beverage management, and 55% dealing with Hotel Management. Marriott referred to their program as “Individual Development (I.D.), which permitted the individualizing of training based upon what units the trainee neared to learn. A normal schedule consisted of 40 units of the overall 108 possible units.  Each learning unit varied from one to three days.  At the end of the 40 units, the management trainee was post-tested to determine if additional training would be required.

This program began in a central training center in Washington, DC, with the ultimate objective that each hotel would become a training center. Management backed this effort by committing $200,000 to the development of the 108 learning units and the project was estimated to take four man-years.  It was projected that there would be no savings from the program would save $300,000 and by the end of the fourth year, the savings would reach $400,000.

• Summary

The consensus of the conference of the Council of Hotel and Restaurant Trainers was a general realization that 1) Training pays rather than costs, and 2) The trainer is not responsible for training. It was felt that, on the average, good training programs were directly responsible for at least a 10% reduction in management turnover. It appeared that other large companies in the hospitality and foodservice industry were beginning to recognize that training is an investment in the development of the human resources of a corporation and were willing to reflect this fact by appointing a corporate level training manager or department and by providing the necessary funds to develop and promote new ideas and programs. 

• Conclusions

 (Note – from Walt’s memo to Bob McKinnon, Howard Johnston’s)

Relating the foregoing information to the current status of Howards Johnson’s training efforts, the following statistics are offered as significant evidence that something needs to be done.

The purpose of including this section in my report to Bob was to help him lobby Howard Johnson’s top management to speed up the process of creating a centralized training department. It worked!

• National Personnel has recently projected 840 Restaurant Management losses by December 31, 1971. This will be a turnover rate of 68.8%.
• The restaurant industry (NRA) has long accepted the figure of $300 as the replacement cost for an hourly level employee who leaves within 30 days.  Although a reliable cost factor for replacing management level personnel is in the development state.  When developed, the management replace figure will certainly be much higher and will most likely fall in the $600 - $1,000 range.
• Using only the conservative hourly figure of $300 and applying it to the anticipated 840 management losses, the result comes to a conservative turnover cost estimate of $262,000 for the company in 1971 (exclusive of salary expense).
• Using a previously accepted company ratio of $14 in generated sales to put $1.00 in the bank, it can be further estimated that the cost of our 1971 management turnover will be the equivalent of at least $3,668,000 in 1971 sales revenue.  The figure exceeds 1$ of the company’s total sales revenue for the entire year of 1970.
• During the Montreal seminar, company representatives generally agreed that central coordinate of properly conducted company training programs results in a minimum 10% reduction in management turnover. (This figure is further substantiated by studies of our Howard Johnson University graduates.)
• A 10% reduction of Howard Johnson’s anticipated management turnover would result in at least $367,000 in retained sales revenue for the year 1971.

Recommendations  

1. In view of the recent and significant steps being planned or currently underway in the area of training by other major corporations in the hotel and restaurant industry, it is recommended that Howard Johnson’s begin an immediate re-evaluation of its training philosophy and activities.

2. It is specifically recommended that the responsibility for training be established, recognized, and accepted as a responsibility of line management and that avoidance or failure to accept this responsibility be treated in the same manner as failure to fulfill other management responsibility.

• Professional assistance is made available to line management by the creation of a corporate staff level Manager of Training and Development who would report to the Director of Personnel Development

• The Manager of Training and Development is assigned the major responsibility for the overall planning and coordination of all company training activities. (Restaurants, Motor Lodges, and Plants)

• The Training and Development Department be provided with minimal annual budget of $100,000 to be invested in the individual development of all the company’s human resources which on the basis of our 1970 figure of 21,500 employees amounts to less than $5 per year per employee.

3. Only through the continued personal development of its human resources will the Howard Johnson Company be able to maintain a competitive edge in the years that lie ahead.

Results of attending the Montreal Conference

Bob attached a “well done” comment to my report and forwarded it to company executives. Two months after attending my first CHART conference in Montreal, I was promoted to the corporate position of Training Manager for Howard Johnson’s with the responsibility for the development, production, and coordination of the company-wide training and development programs.

Needless to say, I became a very loyal member and active supporter of CHART. I received my 20-year service award in 1992 and to this day am very proud of my Lifetime Member status. In our wildest dreams, I am sure that none of the original founding members ever thought that CHART would grow to hundreds of members and become recognized as the leading resource for the development and advancement of hospitality training professionals and their organizations.