The 3 pillars of engagement that helped Chili’s boost stock from $4 to $60
By: Ashish Gambhir

Adaptation, particularly for longstanding brands, is not an easy feat — but the twenty-first century has necessitated agility in recognizing new trends and altering course quickly.

This is the situation that Chili’s Grill & Bar, a pioneer of the casual dining movement and one of America’s best-recognized brands, found itself mired in eight years ago as the country grappled with economic recession and thinning restaurant-goer wallets. Chris Ebbeler, director of workplace community at Brinker International, Inc., which owns Chili’s, saw the need for a self-audit.

“We paused, pumped the brakes, and asked ourselves, ‘what’s going on?’”

Chili’s was founded in Texas in 1975, the brainchild of Larry Lavine, who hoped to create an experience evocative of the burger joints he would walk to with friends as a child of Dallas. This old-school ambiance lived on right up through 2008, when the housing crisis forced many industries to take a step back and reassess their model.

The company was on a downward trajectory and suffering from cultural inertia. The same laid-back mindset that made Chili’s a neighborhood favorite quelled voices that called for change. The business was in dire straits: Brinker stock had plummeted from $35 in 2007 to less than $4 mid-2008. With over 1,500 locations globally, Chili’s is Brinker’s workhorse, and it needed a jolt in order to dodge disaster.

“We did a real big cultural look in the mirror,” he said. “We started thinking about tech, food innovation — and really asked, ‘why do people want to work here?’”

The circumstances were bleak, but taking the company’s pulse led to a sort of renaissance.

“We identified where we weren’t necessarily doing a good job, and that led to a strategic decision: restaurant reimaging; new cooking equipment; a completely different way of looking at the business.”

Chili’s performed a successful self-diagnosis and formulated an ambitious five-year plan, deemed Plan To Win. The focus was on business results: they would attempt to boost Brinker stock tenfold, from under $4 to $40. They sought to double earnings per share.

Aggressive implementation saw the plan begin to yield fruit. Stock rebounded, and innovation drove increased guest satisfaction. But the results came at a price: by the time 2012 rolled around, business was booming, but the employees that saw the brand through the recession were seriously burnt out.

Ebbeler recalls arriving at a national General Manager conference during this period and gazing around in dismay at a workforce that seemed run down and ready to give up.

“We needed to have culture — press the reset button on the brand,” Ebbeler said. “We started looking at our identity and asking, ‘do people get it?’ We started asking our people: ‘What do you want to be known for? What’s your legacy?’ People started tearing up. It was clear there was something there we weren’t tapping into.”

The brand was gleaming, but the brand ambassadors — corporate and restaurant leaders — were uninspired. Recognizing that growth would be short-lived unless something changed, the Chili’s team took a number of concrete steps towards cultivating engagement that any organization can learn from.

1. They started at the top. They transformed their GM conferences from a corporate sleepwalk into a forum for self-exploration and engagement. They flipped the conventional wisdom upside down: whereas most conferences are 20% fun and 80% business, the Chili’s annual GM conference strove to be 80% reflection and team-building. The CEO led yoga sessions; groups of executives ascended to the top floor of the hotel and meditated to the sunset. The unorthodox methods quickly yielded results.

“It was an opportunity to reconnect with people in an emotional element. People said, ‘I’m so disconnected, I’m so plugged in, I’m tired of the rat race, I’m searching for work life balance.’ We also had folks that said, ‘meditation? You’re crazy.’ We had to just let them experience it for awhile.”

2. They cultivated a purpose-driven philosophy. And experience it they did. The thorough efforts to understand the workforce and develop a core Chili’s philosophy laid the groundwork for a cultural overhaul. The company adopted Gallup’s Five Essential Elements of Wellbeing — physical, social, career, financial, and community —as a credo, and began encouraging employees to seek fulfillment in those areas, providing career services, exercise classes and even launching initiatives to help cover college tuition.

“It was like a fuse that lit people up,” Ebbeler said. “The hidden them that was like ‘oh, that’s what it was! That’s what was missing!’”

3. They prioritized frontline engagement. Chili’s originally tasked GMs with spreading the message to the frontline, but eventually realized that a more concentrated corporate effort would be necessary to ensure that the company’s largest demographic was on board with the transformation.

A survey of Chili’s restaurants revealed a consistent picture of organized chaos — back of house was typically pasted wall-to-wall with various charts and data stream meant to guide servers, but the result was frequently confusion. Leadership decided to trim the fat. They selected the three most crucial performance metrics and tasked servers to focus their professional efforts on these, while integrating the Five Essential Elements into training and messaging.

“Team members now are different from 20 years ago — different desires, beliefs motivations. They don’t want to be seen as working for big giant corporate America.”

And that’s not what Chili’s wanted to represent, either. They drafted up a new, no-nonsense server handbook that stressed in no uncertain terms what Chili’s was about: finding purpose and designing a legacy. It was an instant hit.

Only months ago, Chili’s installed a “Chili’s Connection Board” in the back of house of every restaurant location. Managers use it as an engagement platform, giving servers unique tasks to focus on each day and allowing them to answer surveys.

The decision to engage and the adoption of a purpose-driven philosophy had a profound impact on Chili’s and its parent company. Engagement sustained Brinker stock’s meteoric rise, which leapt to an all-time high of $62.29 in early 2015.

Ebbeler attributes the success to core engagement.

“There’s always a need to plug back into, ‘why we do this?’ It’s more than a paycheck, more than the food and the grind,” he said. “We want something authentic and rooted in who we are.”