WASHINGTON — Maybe the best way to keep employees from quitting is to just tell them they’re doing a good job.
Arlington-based employee retention company ShiftOne has finalized a $2.6 million new round of funding led by the Entrepreneurs’ Fund.
ShiftOne’s employee retention app is used by restaurants that include Applebee’s, Burger King, Dave & Buster’s and Five Guys Burgers and Fries. It addresses the biggest challenge restaurant operators face: employee turnover.
The average turnover rate for hourly food service employees in the U.S. is 100 percent a year.
ShiftOne uses a combination of competitions that gamify what waiters, waitresses and bartenders are doing, positive supervisor feedback and artificial intelligence that can spot potential employee problems before they escalate.
When developing their app, founder Ashish Gambhir and his team studied best-performing restaurants and top performers for sales and satisfaction, and found most had transparent hourly employee performance data, managers who were exceptional for recognizing crew members and ways to engage employees to challenge each other.
The app is very heavy on supervisors calling out employees with compliments and heaping on the praise. Gambhir says it’s a brain game.
“When someone feels like they belong or their hard work is appreciated, they are dramatically more likely to continue that effort or try to improve that effort,” Gambhir told WTOP.
“Dopamine is released when they feel appreciated. Oxytcin is there when they feel there is a sense of belonging,” he said.
It’s also good for sales.
“When we go out to eat, if we feel like we’re being taken care of by someone who is really excited to be there, who can introduce the menu in a certain way, we’re more likely to add an upsell to that process, and we’ve seen that,” he said.
And competitions are big on ShiftOne, pitting servers against each other for the biggest checks, most upsales and highest diner ratings.
The app also uses artificial intelligence and predictive technology to flag when a restaurant employee may be about to quit.
“If a team member has historically been a high performer — maybe their check average is higher than others or their tip average is higher than others — but it begins to decline over time, or maybe their customer satisfaction ratings are beginning to decline dramatically, or even things like how often they’re checking the ShiftOne app,” Gambhir said.
“Maybe they were really into the app for a while and now they’re losing interest. We can begin to use these as signals where the right combination can yield some type of indicator that says this team member is likely to quit in the next three weeks. So we can send an alert to the manager that says ‘Hey, you might want to have a conversation with this team member, because they are likely to quit,'” he said.
Investors also included original backer Bowery Capital and new investor NRD Capital, which owns restaurant chain Ruby Tuesday. ShiftOne will use the new round of funding to further expand its product and sales team.
“ShiftOne is mitigating the single costliest dilemma facing companies with hourly team members: rampant turnover rates,” said Michael Brown, principal at Bowery Capital. “This platform is the future of frontline work.”
ShiftOne research shows 71 percent of hourly restaurant workers are disengaged at work, and they are four times more likely to quit than engaged employees.
