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Good versus great: Hospitality is the key ingredient

A conversation with Danny Meyer, Union Square Hospitality Group

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The more you diversify your talent base, the better your quality and hospitality gets.
 – Danny Meyer
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Danny Meyer, founder and CEO of Union Square Hospitality Group and founder of Shake Shack, sat down with "The Middle Market Transformative CEO" hosts Joe Brusuelas and Robert Reiss to discuss how his New York restaurants are addressing labor, technology and innovation.

In our first episode, Meyer shares why he looks to diverse talent pools, how Union Square Hospitality Group balances innovation with a focus on people, and why hospitality, not service, is the great differentiator.  


Restaurateur Danny Meyer knows the value of hospitality – it’s the secret sauce behind the longstanding success of Union Square Hospitality Group, the New York-based restaurant group that counts well-known names such as Gramercy Tavern and The Modern under its fold.

Meyer, known as an industry innovator for moves such as eliminating tipping to level the playing field for employees at his restaurants, is fostering innovation through technology and smart strategies that improve ordering without sacrificing service.

“I think the way that you make people feel, what we call hospitality, is truly the differentiator,” he said in June on The Middle Market Transformative CEO radio show, a joint production of the CEO Forum Group and RSM US LLP. 

The business dates to 1985 when then 27-year-old Meyer founded Union Square Cafe. It now comprises more than 15 restaurant concepts, as well as a thriving catering and events business. Shake Shack, the fast-casual burger chain touting fresh ingredients that Meyer founded in 2004, went public in 2015, and now operates more than 180 restaurants in the United States and internationally. Meyer is the company’s chairman.

In an effort to contain labor costs in New York City, where minimum wage is set to reach $15 an hour, Shake Shack is experimenting with self-ordering kiosks at several restaurants, Meyer said. The move allows the company to reduce the number of overall positions during a shift by using fewer cashiers but adding a smaller number of more highly compensated maître Ds who assist in the ordering process.

“This is as challenging of a labor market as I’ve ever seen in my entire career,” Meyer said, noting that the kiosks take orders flawlessly, and they “are pretty good as suggestive selling too.”

Meyer is also recruiting talent from populations his business never before considered by reaching out to a variety of schools, as well as groups that place formerly incarcerated individuals.

“We look for somebody who has got a high HQ, what we call a high hospitality quotient,” he said.

Meanwhile, at Vini e Fritti, USHG’s new Roman-style wine and aperitivi bar, the company is reducing labor costs with a process that calls for customers to check off their orders on sheets of paper at their tables; the sheets are then handed to servers. Meyer said this simple system cuts down on 20 percent of the labor that would have been required to take orders at the outset.

Choices such as this are carefully evaluated to ensure they don’t compromise service.

“We’re not interested in changing any of our full-service concepts to try to dumb down any of the hospitality or service or culinary experience,” he said. “It’s unlikely that you are going to see robots making pizza.” 


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