Danny Meyer, the founder of Union Square Hospitality Group and Shake Shack, is one of the most influential restaurateurs and business leaders of his generation. His philosophy of "Enlightened Hospitality" has revolutionized the service industry by prioritizing employees over customers, a strategy he argues leads to superior customer experiences and robust shareholder returns.
On Enlightened Hospitality
This is the cornerstone of Meyer's philosophy: a belief that the best way to create a thriving business is to prioritize stakeholders in a specific order: employees first, then customers, the community, suppliers, and finally, investors.
Quotes:
- "Enlightened Hospitality is the idea that the more you give, the more you get."
- "The single most important thing you can do in business is to hire and retain great people."
- "By putting our employees first, we have a lasting competitive advantage. It's the most selfish thing we can do."
- "Hospitality is a dialogue. To be on a guest's side requires listening to that person with every sense, and following up with a thoughtful, gracious, appropriate response."
- "Service is the technical delivery of a product. Hospitality is how the delivery of that product makes its recipient feel."
- "The interests of our employees, guests, community, suppliers, and investors are best served when they are in harmony."
- "Enlightened hospitality looks for the win for everyone."
Learnings:
- The Virtuous Cycle of Hospitality: Taking care of your employees first creates a happy, motivated team. That team then provides outstanding service to customers. Happy customers become loyal patrons and evangelists for your brand. This loyalty enriches the community and rewards suppliers. Ultimately, this entire cycle leads to strong, sustainable profits for investors.
- Distinguish Service from Hospitality: Service is what you do to someone (e.g., delivering a plate); hospitality is what you do for them (e.g., anticipating their need for a new napkin). One is a monologue, the other a dialogue. Mastering the technical aspects of service is the bare minimum; genuine hospitality is the differentiator.
- Hospitality is a Team Sport: A guest's experience is the sum of every interaction. The host, the server, the busser, and the chef all contribute. Therefore, a culture of hospitality must be embraced by every single person on the team.
- Prioritize Your Stakeholders: The traditional "customer is always right" mantra is flawed. The employee comes first. A supported, respected team is the only way to consistently make customers feel great.
On Hiring and the "51 Percent" Solution
Meyer believes the most crucial factor in an employee's success is not their technical skill, but their emotional intelligence and innate hospitality.
Quotes:
- "We're looking for 51 percenters. We can train for the 49 percent—the technical skills. But the 51 percent—the emotional skills, the hospitality—that's what makes a great employee."
- "A 51 percenter has five core emotional skills: optimism, curiosity, empathy, a strong work ethic, and integrity."
- "I don't care how technically proficient you are; if you're not a 51 percenter, you won't be hired."
- "A bad hire is like a cancer; it can spread and destroy a healthy culture."
- "Resumes are the least important part of the hiring process. I'm looking for a twinkle in the eye."
- "The best people are the ones who are always looking to learn and grow."
Learnings:
- Hire for Character, Train for Skill: You can teach someone how to pour wine or use a point-of-sale system, but you can't easily teach them to be genuinely warm, kind, and optimistic. Prioritize innate emotional skills (the 51%) over technical abilities (the 49%).
- Define Your Core Emotional Skills: Identify the specific character traits that are non-negotiable for your organization. For Meyer, these are optimism, kindness, intellectual curiosity, work ethic, empathy, self-awareness, and integrity. Hire and promote based on these traits.
- Use "Trailing" to Vet Candidates: Have potential hires work a shift or two. This allows both the team and the candidate to see if there is a genuine cultural fit. It reveals more about their 51% than any interview can.
- Protect Your Culture Fiercely: One "49 percenter"—someone who is technically skilled but emotionally tone-deaf or cynical—can demoralize an entire team. It's better to be short-staffed than to compromise on your hiring principles.
On Making Mistakes and "Turning Up the Lights"
Meyer sees mistakes not as failures, but as the best opportunities to build relationships and show guests you care.
Quotes:
- "The road to success is paved with mistakes well handled."
- "A mistake is not a mistake until you fail to correct it."
- "We want to turn up the lights on our mistakes. We want to see them, acknowledge them, and learn from them."
- "The best way to build a reputation for great service is to be brilliant at recovering from mistakes."
- "You have to be a 'master of the art of the apology.' A great apology has five A's: Awareness, Acknowledgement, Apology, Action, and Additional Generosity."
Learnings:
- Embrace "Athletic Hospitality": Just like an athlete, you must have a "short memory" for mistakes, but not before you've learned from them. Address the error, fix it, and move on with a positive attitude.
- The Five A's of Mistake Recovery: To genuinely recover from an error, you must: 1) Become Aware of it. 2) Acknowledge it to the guest. 3) Apologize sincerely. 4) Take Action to fix it. 5) Offer Additional Generosity—a gesture that goes above and beyond, like a complimentary dessert, to show you truly care.
- Write the Last Chapter: When a guest has a bad experience, they leave with a story. By handling the mistake brilliantly, you get to "write the last chapter" of that story, turning a negative into a memorable positive and creating a loyal customer.
- Collect the Dots, Then Connect Them: Encourage a culture where small errors are reported without fear. One dropped glass is an accident. Three dropped glasses in the same spot may reveal a slippery floor. Seeing patterns allows you to fix underlying system issues.
On Leadership and Management
Quotes:
- "A leader's job is to create a constant, gentle pressure to improve."
- "The most important thing a leader can do is to have a clear vision and to communicate it relentlessly."
- "My favorite thing to do is to catch people in the act of doing something right."
- "Your staff and your guests are always changing. The terrain is always changing. So you have to be a 'constant, gentle pressure' kind of leader."
- "Shared ownership of the problem is the only way to solve it."
- "Be the kind of leader that people want to follow, not the kind they have to follow."
Learnings:
- Lead with "Constant, Gentle Pressure": This philosophy means never being satisfied with the status quo but pushing for improvement in a way that is supportive and encouraging, not dictatorial. It’s about being a coach, not a commander.
- Be a "Skunk in the Meeting": A leader should sometimes be the one to challenge assumptions and ask uncomfortable questions to prevent complacency.
- Focus on Praise: It's more effective to build on strengths than to constantly criticize weaknesses. Publicly celebrating wins and positive behaviors reinforces your cultural values for the entire team.
- Clarity is a Leader's Greatest Gift: You must be able to clearly and concisely articulate your vision, your values, and your expectations. If your team doesn't know where they're going, they can't help you get there.
On Business and Life Philosophy
Quotes:
- "Business, like life, is all about how you make people feel. It's that simple, and it's that hard."
- "The best way to get a 'yes' is to make it easy for the other person to say 'yes'."
- "You can't control what happens to you, but you can control how you react to it."
- "The salt shaker is my favorite object. It's a symbol of hospitality. Your job is to figure out if the person needs salt, and if they do, to get it to them. It's not about you; it's about them."
- "Whoever wrote the rule that the customer is always right was not a leader. They were a bureaucrat."
- "Life is a series of waves to be ridden."
- "Success is not a straight line. It's a series of zigs and zags."
- "The more you give away, the more you get back. It's the universal law of hospitality."
- "You have to be a little bit of a masochist to be in the hospitality business."
- "Your legacy is not what you do; it's how you make people feel."
Sources
The vast majority of Danny Meyer's philosophy is captured in his book, which remains the primary source.
- Book: Setting the Table: The Transforming Power of Hospitality in Business - This is the definitive guide to his principles and the source for most of the learnings above. (Amazon)
- Interviews and Talks:
- The Tim Ferriss Show Podcast: An in-depth interview covering Enlightened Hospitality and the 51% rule. (Link)
- NPR's How I Built This Podcast: A narrative of how he built Union Square Hospitality Group and Shake Shack. (Link)
- Inc. Magazine: Articles and interviews often feature his quotes on leadership and customer service. (Example Article)
