How to maximize your small business?
In 1966, Pierre Bellon, a member of the famous French Bellon family, founded Sodexo in Marseille, France. This is a labor-intensive service company that deals in small businesses such as group meals and service cards. However, it has been able to perfect its small business through refined management over the past 50 years and replicate its business model around the world. 80 countries.
Sodexo was listed in Paris in 1983 and in New York in 2002. In 2014, Sodexo ranked 493rd among the Fortune Global 500, with operating revenue of 18 billion euros (24 billion U.S. dollars based on the current exchange rate), higher than well-known multinational companies such as Fuji Heavy Industries and British American Tobacco.
Sodexo is now not only the world’s largest catering service company, but also the world’s second largest service card company, the world’s largest professional river cruise and port management company, and the world’s largest field base service provider. These subsequent businesses were all due to group meal services.
Founder Bai Long’s philosophy is to maximize traditional business and put people’s development first. No matter what we do, the company will naturally achieve healthy growth.
As the 18th largest employer in the world, Sodexo has more than 400,000 employees spread across 33,000 business locations. The educational background of these employees ranges from elementary school education to Ph.D. Bailong intends to make the company a social enterprise, hire disabled employees and disadvantaged groups, improve employees' abilities through scientific and systematic training, and intends to increase the proportion of female employees in management to enhance equity in development.
Sodexo’s inspiration to people is: do not do anything for the sake of small profits, do not do anything because of tradition, and do not get involved in industries that have nothing to do with core competitiveness, even if they are high-profit. Its business structure ranges from building cleaning, security, gardening, to laboratory maintenance, office building energy-saving planning, and even employee care? Butler-style services are enough to allow client companies to concentrate on their main business and move forward with ease. After Sodexo's careful planning of some trivial and complicated matters, it not only helped customers improve their efficiency, but Sodexo also dug out gold mines from them.
Chinese companies continue to emphasize transformation and development, but often not only lose their core business during transformation, they also suffer failure because they fail to establish core competitiveness in new fields. Over the past 50 years, Sodexo has insisted on perfecting its main business, cultivating ordinary people into talents through methodology, and expanding the capabilities established in the main business to related service fields, using its core competitiveness in some seemingly meager profits. Labor-intensive industries have established an unshakable position, which is what Chinese companies need to learn from.
How to dig out gold mines from group meals
The history of the French city of Marseille is a history of the sea. The long coastline has created a developed port trade and shipping industry. In the early 20th century, the French Bellon family started here and engaged in supply services for small ships.
When Pierre Bailong, a member of the Bailong family, founded Sodexo, he continued the ship supply service. With the wave of decolonization in France, Marseille's share of shipping has been decreasing year by year. However, the European economic revival after World War II has boosted the service industry. Many companies have begun to set up company canteens, giving rise to the rise of catering outsourcing services. Relying on the family's more than 60 years of experience in providing catering services for luxury maritime routes and cruise ships, Sodexo began to focus on providing services to various institutional customers such as enterprises, schools, hospitals, etc.
Just one year later, Sodexo received a request from the French National Center for Space Studies (CNES) to provide maintenance of ground facilities for its space center in French Guiana, as well as to build and manage a Hotel and a small supermarket. This is a strong signal: If the customer is very satisfied, it may lead the company's service business to expand into areas that have never been reached before.
Thus, Sodexo began to diversify outsourcing services with group meals as the center. Create a unique development path in a market that requires a large workforce, diverse employers, and meticulous corporate concierge services.
In 1995, Sodexo came to China. In the eyes of Greater China CEO Christophe Solas, there was no so-called outsourcing service market in China at that time, and people did not even have a sense of service. Entrepreneurs needed to show their pioneering spirit. Relying on the foundation it has laid in the European and American markets, Sodexo continues to serve these old customers who came to China in the reform and opening up China. But now that we have come to China, we have to consider how to penetrate into the Chinese market and not just continue our original customer resources. Sodexo began to contact central enterprises in 2002, and it just met an opportunity. In 2003, the State-owned Assets Supervision and Administration Commission proposed the goal of separating core and non-core businesses for central enterprises, requiring central enterprises to gradually reduce their investment in auxiliary non-core businesses. Against this background, some central enterprises have begun to initiate relevant reforms, hoping that by outsourcing their logistics services to third-party professional service providers, they can reduce staff and increase capital, streamline their main businesses, and enhance their core competitiveness. Sodexo began to cooperate with state-owned enterprises.
In October of that year, Sodexo received its first invitation from a state-owned enterprise to provide group meal services for factories with more than 10,000 employees. The premise is that the company needs to accept and place more than 150 former state-owned enterprise logistics service employees. How to steadily attract, receive, train, and manage these employees is the top priority of this project. At the same time, how to mobilize the original team to improve customer satisfaction is another huge challenge. There are no corresponding cases and regulations in China to refer to, and service solutions need to be creatively designed to solve the immediate problems.
Sodexo’s business model is simple. In most cases, the services provided can be completed by a single person or a team. No fixed assets are invested in property or complex equipment. Variable costs such as employee wages and raw materials are the main expenses. Usually when signing a contract, Sodexo will admit employees who are already doing relevant work in the client company and retrain them to meet Sodexo's professional specifications. The threshold for becoming a Sodexo employee is not high, but work attitude and working methods are very important. This is the foundation of the service industry.
When Sodexo competes for orders from state-owned enterprises, some people often think that the service prices of French companies must be more expensive than Chinese companies. ?Across the world, customers want the most competitive prices, and that's human nature. ?The price should correspond to the level of service. In emerging markets, people have not yet established the concept of high quality and good price, let alone set standards for service. However, Sodexo will set minimum service standards and price standards, because this is the basic configuration to ensure supply chain and food safety, and the company itself also needs to have a clear profit plan. Christophe said, "If the price is too low and cannot be profitable, employees will not be able to receive better benefits, and the company will lose the sustainability and stability of development." ?
The entry threshold for the group meal market is not high, and competitors compete with each other for costs, resulting in low-profit operations. However, this is an extremely demanding market, and the needs for practitioners are different. Take front-line waiters as an example. About 80% of the customers faced by waiters in the mass catering service industry every day are strangers, while about 90% of group meal customers are regular customers. They need to establish long-term cooperation and trusting partnerships with customers. Menu requirements are also different. Public catering has fixed menus, but the group meal industry has greater demand for dish innovation. Sodexo uses more than 80 conventional ingredients to create hundreds or even thousands of different dishes based on different meal standards at different operating locations. Due to limited lunch time, service providers must ensure that they can provide meals to thousands or even tens of thousands of people within a limited time.
In the process of cooperating with this state-owned enterprise, personnel reorganization is only superficial. New employees need to be integrated into the company's standardized operating system and provide standardized services in accordance with Sodexo's standards.
When Sodexo competes for orders, its services will be standardized, measurable and traceable, and employees need to comply with contract provisions to provide services. To this end, the company has gradually introduced a series of targeted training for managers at operating points, such as computer skills, English proficiency, etc., and trained people to use necessary operational tools, such as supply chain, finance, and personnel-related reporting systems, etc. Flexible methods are also used to mobilize employees' enthusiasm for active learning.
In addition to professional integration, cultural integration is also very important. Sodexo has established an "operation point management committee" system to allow these old state-owned enterprise employees to exercise their "ownership" spirit and exercise autonomy. This can bring unexpected results. Old employees already have extensive connections here and have better communication channels and problem-solving abilities than outsiders when encountering problems.
The transferred employees gradually found confidence in the organization. They were originally members of non-core departments in state-owned enterprises. After arriving at Sodexo, they became core employees and their sense of self-identity was greatly enhanced. Looking back at the more than 150 logistics service employees received from state-owned enterprises 10 years later, 96% were retained and the promotion rate was 30%. Some even joined the Sodexo China management team and became the backbone of the company. With the company's new operating points The establishment actively seeks development opportunities. This solution inspired by China's national conditions has also become a model for Sodexo to develop state-owned enterprise customers in the future and will be constantly copied.
Since 2011, this state-owned enterprise has outsourced factory logistics operations and maintenance, environmental greening, cleaning and other business support services to Sodexo. Sodexo has introduced health, safety and environmental management and control standard processes, established various standards to measure service quality, retrained receiving employees, and supported employees with professional technical strength to help employees go global in the direction of marketization. . In 2013, by increasing service items and improving labor productivity, revenue increased by 7% compared with the previous year, while operating costs dropped by 5%, and the incidence of major safety accidents and accidents causing economic losses was reduced to zero.
From group meals to comprehensive services, how does Sodexo find opportunities in various businesses? How does it establish its own unique competition in a service market with price sensitivity, fierce competition, and rising labor costs? What about strength?
The secret is talent development and standardization.
The core competitiveness of the service industry: talent and standardization
The challenge of the service industry is that the entry threshold is not high, but it is difficult to maintain a sustained and stable commitment. Sodexo employees are required to work on customer premises, and each customer's requirements are unique.
It is difficult to ensure service quality based solely on employees' passion and on-the-spot performance, and it is also difficult to evaluate service effectiveness. Therefore, companies need to balance customization and standardization, which is very challenging.
Before Sodexo, few people conducted quantitative analysis and research on services and established tracking mechanisms, because service is an instantaneous action. Whether the waiter washed the dishes, wiped the table according to the prescribed procedures, and what was wiped. These degrees are called clean, and these are difficult to verify.
To this end, Sodexo builds service quality from two dimensions. The first is to cultivate and develop talents, and the second is to establish standardization.
Dimension 1: Talent development. Managing Sodexo is an extraordinary challenge. The more than 16,000 employees employed in China alone come from more than 30 cities across the country, and migrant workers with non-local registered permanent residence account for more than 50%. It provides more than 200 different types of jobs, including a large number of grassroots employment opportunities with no threshold. Sodexo emphasizes the spirit of service, team spirit and enterprising spirit. As long as these three core spirits are present, it can help employees find a suitable position in the company regardless of their academic background and origin.
The turnover rate of Sodexo China’s front-line employees was once as high as 200%, and many positions were filled by migrant workers with low education. These groups are like migratory birds, willing to endure hardship, but they are also highly mobile. The company needs to consider everything for its employees, such as allowing employees to choose their favorite positions and work at the operation point closest to home, designing some special benefits for migrant workers, helping new employees integrate into local life, solving difficulties in daily life, and also targeting Chinese New Year proposes a policy of reimbursing travel expenses when returning to work after the New Year to minimize employee mobility.
The key to whether employees can stay on the job for a long time depends on training to bring more career development opportunities to employees. To this end, Sodexo invests heavily in training and creating a platform to share knowledge and best practices. The company's employees are grouped by job type, such as boiler service technicians, housekeepers, and caterers, among others. A team of experts trains newcomers and provides best practices that can be shared around the world.
After training, promotion opportunities must be created for employees. Many managers are slowly promoted from the bottom employees. A female executive in the United States was just a waitress for a customer 18 years ago. What’s attractive is that Sodexo China has been cooperating with the Ecole Supérieure de Tourism et de l’Hotel des Angers (ESTHUA) in France since 2009 to establish the first Sino-French master’s degree in corporate catering services. So far, it has funded 5 batches of students. Fresh graduates go to France for further studies. It not only provides blood transfusion for the enterprise, but also continuously develops the skills of employees. After a series of efforts, the turnover rate of front-line personnel in Chinese companies has dropped from 200% to 50% annually.
Dimension 2: Establish standardization. In its long-term practice, Sodexo has summarized a large number of efficient and cost-saving best practices, which have also benefited customers. The price quoted by Sodexo is much lower than the investment required by the client company to undertake this part of the work itself. These best practices need to be standardized to clarify profit points and facilitate knowledge transfer globally. To this end, Sodexo Investment has established a team of highly qualified experts to strengthen on-site training and guidance on key tools and processes such as Lean Management and Six Sigma to help the operations team discover and avoid waste in operations and business processes, while optimizing Operational sites and company organizational structure.
With the advancement of technology, Sodexo drew on the advanced software systems used in the North American market to develop an IT management system for patient nutrition meals for Chinese hospitals, converting hospital nutrition meals from manual recording of medical orders to automation and mobile terminal management (as shown in the diagram). Doctors, clinical nutritionists, caterers and buyers can keep abreast of the latest treatment and dietary records of inpatients, read their physical parameters, and reduce service error rates. This allows clinical nutritionists and chefs to proactively design nutritional recipes that better meet the needs of patients. At the same time, the operations team can more accurately estimate and place orders through Sodexo's unique food ingredient supply chain, thus accelerating the recovery of hospitalized patients. It also reduces food waste.
For tasks that still need to be done by hand, for example, for group meals, how many grams per serving of rice, what is the protein content, and how to mix nutrients are all clarified when signing a contract with the customer. When training employees, different dishes are required to have different processing temperatures, and the dishes must be eaten within two hours after being served, otherwise they will be scrapped. For example, wiping tables and wiping windows have been defined by the expert center to form standard operating procedures. The order, gestures, and tools must be trained repeatedly to achieve standardized services. Employees who receive training can do well as long as they put their heart into it, regardless of experience or academic qualifications.
At the same time, in order to make services traceable and measurable, Sodexo worked with professors and research centers to finally determine 6 key indicators: natural environment, social interaction, physical and mental health, social recognition, efficiency and personal develop. All services provided must meet at least one of these indicators.
With clear indicators, measuring business performance becomes simple. For example, after the maintenance of the HVAC system, whether the number of sick days of the client company's employees has been reduced, the correlation between employee weight and the healthy diet in the cafeteria, and whether the re-planning of the office space will help improve work efficiency and communication.
Each service plan can be implemented into specific digital evaluations, giving both parties a basis for mutual trust.
Customize for customers and create new business opportunities
For services, what customers are most concerned about is whether the promise can be fulfilled in a long-term manner. This is the basis for building trust. Precisely because of the efforts made in personnel development and standardization, after customers realize the advantages brought by professional services, they dare to further cooperate and deepen into some untried areas.
One of Sodexo’s clients is a leader in the global communications industry. When providing services for its Beijing innovation and manufacturing center, the client proposed a very strict budget reduction target, and these budget controls were all It must not affect day-to-day operations or employee satisfaction.
Using the Sodexo methodology of “design, manage and deliver solutions”, the team established a temporary project team of 12 people from Sodexo’s facility management expert center and engineering team. The team spent three months analyzing and processing thousands of collected operational data. Based on this, they initiated 14 power-saving projects and 5 water-saving projects, and negotiated with external suppliers to reduce the purchase of key equipment components. cost, while controlling the increase in prices of drinking water, green plants and related items, and even optimizing shuttle bus utilization. As a result, the customer's Beijing factory reached the gold level standard of the customer's global lean manufacturing project in the self-audit in 2012. These creative foundations are still based on previous standardized practices to make service results measurable.
Sodexo is a small business, and its business philosophy is to only provide services that can immediately improve the quality of life of individuals (customers). Although it serves enterprises, government departments, schools and hospitals, it is individuals in the organization who ultimately achieve the goal. Sodexo started with catering outsourcing services and later developed into three major businesses: on-site services, incentive and reward services, and personal and family services. It has entered a wide range of fields, including owning Michelin restaurants, providing services to the military and prisons, providing support for engineering bases with harsh environments on land and sea, providing professional maintenance services for pharmaceutical laboratories, and even helping hospitals and enterprises with relevant qualifications. Certification. From low-end labor-intensive services to high-end precision services, Sodexo has weaved a long service chain, linking business opportunities, and the origin is just that group meal, after achieving the ultimate in a business , gold comes from within.
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