Fortunately, Covid-19 is not all that will shape the next few years; it is time to resolve some old problems as well.
2020 was the year of Covid-19. Restrictions, lockdowns, reopening… and lockdowns again. As time passed, we didn’t need experts in virology to tell us how tiny viruses would easily cripple our social life and economy in a surprise attack, but we experienced it first-hand. The foodservice industry got hit the hardest by contact restrictions and the forced closures of restaurants. We will face an unprecedented revenue loss of up to 300 billion US$ by the end of 2020. The decline in Europe may be as high as 51-77%. The story of 2020 couldn’t have been better described in some dystopian novel.
There is no crystal ball needed to predict that the pandemic impact will persist in 2021, and we can only hope that the vaccine will slowly but gradually get us back to normal; however, this “new normal” will look like. For the industry, the pandemic raised problems and challenges that have been untouched and not solved to the surface that we otherwise would have tackled way later.
Furthermore, to get back in the game, stabilize the business, and generate a potential for growth means more than dealing with pandemic challenges. Above all, it means opening the backpack full of problems we already had before the pandemic and focusing on strategies to make a change.
The last year taught us one thing: expect the unexpected, and expect it to happen at any time again. Hence, it is important to have a “post [whatever might happen] roadmap”.
Good-bye old business habits
Covid-19 caused a shock to the foodservice industry, causing changes like a lightning strike. A lot of what we had to learn spontaneously still feels unfamiliar. Soon we’ll be able to master Covid-19, or at least we’ll be able to deal with it better and longer for the old standard. People tend to fall back into familiar habits in these situations, looking for the well-known comforting feeling.
“Good or bad, habits always deliver results”, this quote by Jack Canfield illustrates that we are constantly led by our habits, whether they are good or bad.
Many changes that were forced by covid-19 are irreversible. Many pre-pandemic habits will no longer find a place in the “new normal” of the future. Sounds like a threat? It is a chance to finally start working on challenges that our industry has been facing for too long already.
In a fast-changing environment, it makes perfect sense to look at other industries that are even faster evolving than the foodservice industry. The analysis by the Boston Consulting Group on the topic “Service factory of the future” shows that there will be two major blocks: a predictive and an assembly engine. These engines fulfill specific tasks such as ultra-personalized and proactive offerings, flexible digital platforms, and individualized delivery.
One may object that these are topics for large industrial companies. However, this is only partially true. Over the last few months, we have seen significant changes in the field of delivery and flexibility in the design of offers. While the pandemic initiated these changes with all their complexity, the individualization of offers requested by customers has kept pace.
Except for a few QSRs, our industry is usually a long way behind technological developments. Now is the time to look at what the foodservice industry will have to deal with after a few year’s delay. Clever use of digitized processes can help with the industry’s typical headaches: forecast systems for orders and goods flow, avoidance of food waste, individualized and efficient staff-planning, and, above all, the requirements of hyper-customizing the offer.
Talking about staffs; the old pyramid-shaped hierarchy gives way to a so-called rocket-shaped organizational structure – and that brings us to a very old subject; Company culture.
Culture – A new old focus
The topic of company culture is more present than ever, even before the pandemic. As easy as it is to demand a better company culture and provide presumably clever tips, it is more difficult to actually develop a real culture for a unique company. Even if I might shoot in my foot: if you read an article like this one with about 3000 words on a topic, without trying to put what you have read into action, the whole thing is doomed to fail from the start. You are an individual, and your company is individual. There cannot be a one-fits-all instruction. Let us limit ourselves to highlight a few particularly important points.
A pillar of every company culture is leadership – or how it enables others to lead holistically. There are plenty of good leadership models out there: leading by objectives, transformational and authentic leadership, the entrepreneur in the enterprise, and the gardener principle – just to name some. All models come with the best of intentions to make organizations more efficient and humane. Although, many ultimately fail in the practical implementation. Suppose this part of culture only takes place on nicely framed printouts in team and meeting rooms, instead of being lived honestly. In that case, many employees will see this only as a farce. Let’s get the picture; if the gardener only knows a sledgehammer, then all efforts are in vain – the staff just won’t buy-in.
Out there are many foodservice operations with a role-model leadership culture that is fully supported by the staff. One of the odds; there is often no leadership philosophy behind it, no culture on a drawing board planned. Here, the company culture comes naturally because of a deeply rooted intention to be a company for people and with meaning.
Finding people that are naturally able to develop a culture is not easy. And here is the kicker: it is expensive because the great staff who will embrace the customized culture you are looking for is hard to find, not easy to attract, and needs room for growth. Qualified employees in the near future will not only be scarce, but they will also be a luxury; even with the effects of digitalization, galloping automation, and a short term surplus due to the pandemic. How can that be?
Rise of a new workforce – Hello Gen Y and Z!
Gen Y and Z will be way less likely to stick to one job for life. The reassuring feeling of having a permanent job, a supposedly secure position, will give way to the requirement to adapt the job to more flexible living conditions. Having more than one job might create complexity, but on the other hand, it enables flexibility. No need to struggle with a job that no longer suits you; trying something new will be normal while the other gigs pay the bills.
A job for the whole of working life is now out of date, and a learned profession will no longer be suitable for the entire life in the future. Both effects will force the foodservice industry to invest massively in the training and qualification of employees. Sadly, while many decision-makers still believe that a stringent life would be an expression of reliability and willpower, this boredom will soon no longer find interesting offers. Who wants an employee who knows nothing but his job?
Ultimately, greater flexibility also means less in-depth qualification of employees. This will particularly but not only apply to employees in the low-wage sector.
The workforce will still consist of managers, well-trained employees, and employees from the low-wage sector. But Gen Y and Z will demand more meaning from what they do every day. Simply making money is less important in a diversified culture. What sounds like a threat to the work model as we know it today is a logical response to the needs of a new generation and a rapidly changing economy. It is an opportunity to take the work-life model to a new level.
Embrace equality & fair play
Equality. Diversity. Social justice. For all of us, these words have a different meaning. Perhaps you are thinking of the equality between men and women, the black lives matter movement, or the acceptance of homosexuals and transgender people.
However, the devil is in the details. Women and men are often not paid equally for the same job. Cultural origins too often play a role in promotions, and transgender people still fight for acceptance. Sometimes inequality is even more subtle. Just one example: we know since 2016 that almost 60% of employed tertiary-educated refugees in the European Union are overqualified. It is more than likely that these numbers will be similar in the U.S. What a waste of potential! Sometimes the language barrier prevents a fairer integration, but sometimes it is simply prejudiced and established models of thought.
Same with neurodiversity and people like Greta Thunberg that have, e.g., Asperger’s syndrome. We all know that people on the autism spectrum can think differently and follow unconventional solutions – exactly what you need if you are looking for innovation.
We all agree that cultivating a diverse and inclusive workforce is nothing that should be discussed; it simply needs to happen. Every employee is just a human being, regardless of gender, sexual orientation, cultural background, or disability.
Therefore, equality and diversity are topics that most employers want to implement more or less seriously or have to due to legal requirements. But social justice in this context is a tough nut to crack. Treating people equally ultimately means paying the same salary and ensuring equal growth opportunities. We are still a long way from this, and it is simply a question of morality and how we position ourselves.
Focus on sustainability
In three decades, we might be looking at a planet of 10 billion people. We’re going to have to fundamentally change our existing food system if we are to feed the whole world healthily and sustainably in the face of the danger of climate change. While there is no single answer to this enormous global issue, one particular ingredient is now turning heads. From government backing to big food industry leaders like Unilever, microalgae have come under the spotlight as a sustainable, nutrient-rich future food solution. Algae, it seems, can be an important piece of the puzzle.
Even if Covid-19 has distracted us from it for a long time: we have much more important problems to solve than this pandemic. Don’t get that wrong: we all hope that in the end, Covid-19 would only claim the lives of as few people as possible. Moreover, from a rational point of view, the threat posed by climate change is just as present. We know that the pandemic victims will be a fraction of what awaits us if we do not act instantly. As to climate change, we sit like rabbits caught in the headlights, seemingly paralyzed by the size of the task, for which the answer is not simply a vaccine. In brief, there are three short points that stand out in particular.
Don’t worry, no discussion at this point if it is right or wrong to eat animals or not – this should be an individual decision based on personal ethics and values. Still, it is necessary not only to discuss whether we continue to rely on animal protein but whether we can still afford it.
Producing meat for the mass market is far from efficient. It is, sorry to say, one inexcusable disaster. If you were to see cattle as a country, it would rank third when it comes to producing carbon dioxide emissions – after China and the U.S.; Not to mention the ethical dimension of meat production.
It is reassuring to see that young people, in particular, are reducing their meat consumption significantly and evaluating alternative protein sources as being equally, if not more important. This is not about stigmatizing meat as bad. It’s about giving meat back the value it deserves.
Smart foodservice companies have long understood this and re-aligned themselves; more emphasis on meat with a sustainable origin while providing plant-based alternatives with a story that leaves nothing to be missed by the guest.
In the U.S. and EU, between 30-40% of the food supply is finally ending up as waste and is responsible for about 8% of CO2-emissions – trend ascending. While the industry is already making vigorous efforts to further reduce the amount of food waste, the question of what happens to that waste remains. Both the U.S. and EU aim to create a circular food economy to cut food waste by 50% before 2030.
The leftovers on the plate are only part of the problem but clearly show how much this issue scratches our comfort zone. Deep down inside, we would like to have everything available anytime. It all starts right there. As a guest, there is no way around demanding that food should not be wasted. However, to a reasonable extent, the foodservice industry must also explain what is required on the customer side. This dialogue only succeeds if there is appealing communication that takes the customer on the journey, makes him part of clever strategies, and celebrates success. A great way is to display positive progress rather than depressing numbers. Create challenges and engage customers to be an active part and not spectators.
Full force regional?
What do avocados, bananas, sugar, soybeans, almonds (unfortunately also those in your almond milk), fish such as cod and salmon, coffee, meat, and sugar have in common? Sure, the bad ecological balance. There is no reason to demonize these foods per se, but there is a growing awareness of the origin of foods. The positive impact of Covid-19 is a greater focus on regionality, as the pandemic has also concentrated on food increasing and manufacturing weaknesses through bottlenecks. Regional buying is suddenly in vogue- if you can afford it.
Furthermore, for the food service industry, a purely regional purchase of food is a commendable long-term goal but hardly achievable in the short and medium-term. Often it fails less because of the price, but simply because of the production capacity and availability. Customers are more realistic than we think they are. They also know that we cannot change everything in an instant. Still, they value sincerity and trying to do better. Even if the avocado on the salad still uses up too many resources, the lettuce and the chicken may be from a farmer around the corner. Companies that clearly communicate serious efforts and show “hey, we are on the way, but we need you for this” win not only trust but fellow campaigners.
However, in the future, regionality will look different from the traditional image that we have. One example is vertical farming, which is already taking more concrete forms and needs to become profitable in the next step. In hydroponic systems, plants grow vertically stacked without soil but with a controlled supply of nutrients. Studies show that growing produce this way could be up to ten times more efficient than traditional farming while saving on natural resources.
This technology is still in its infancy for mass production and will not deliver economically viable results until 2035. However, for the foodservice industry, it is worthwhile to take a closer look and start tests, e.g., to grow herbs or other fast-growing plants for their own needs. The restaurant L28 in Tel Aviv – a non-profit business and chef accelerator – already shows this impressively. From a marketing perspective, that makes perfect sense and gives a new technology a needed boost.
Fortune favors the brave
The role of the foodservice industry in dealing with these topics is controversially discussed. The question is whether we will drive these issues or will be driven. One essential aspect will be how we interact with producers, those who process, and those who consume food. People want to be involved in where their food comes from and how it is processed – but in some cases, they cannot or do not want to pay for it. Politicians, too, have a duty alongside all lobbying and will not be able to resist tackling real changes for much longer.
Truly, it is precisely in our industry that we have the opportunity to initiate on all fields the necessary changes and drive the process forward as real “game-changers”.
Our industry will be on the serving plate and measured by how we act. Subjects such as real corporate structure, the creation of fair and equal jobs, honest communication with customers, and how we seriously promote sustainability will be the dominant topics.
As said, after the pandemic, there is still a backpack full of challenges. Now it’s time to dust off this backpack and put on our trekking shoes. We can draw on our industry’s full and enormous potential in this very backpack to confidently start the hike. Sure, it won’t be easy, but it will be all the more satisfying when we’ve made it.