MBA By TV: Business Lessons Learned From Watching Kitchen Nightmares

This guest post was submitted by Nikole Gipps

A friend of mine told me that the Fox Show called "Kitchen Nightmares" should be required material for anyone in business. Each episode, Gordon Ramsay visits a restaurant that has the passion and desire to own a restaurant, but very little sense in the way of running a restaurant business. Gordon brings in his restaurant and hotel management skills, his chef experience, and the ability to make hard calls from the point of an outsider to turn these establishments around. I don't watch a lot of TV, but I happened to have the opportunity to catch one of the shows recently. (The episode discussed here on the the problems at Campania's Restaurant in New Jersey can be seen online at Fox On Demand.) For those who don't mind the spoiler, I've summed up the major business lessons from the show here:

Being a business owner isn't about making friends.
When you are the owner of any restaurant, you have to be the bad guy sometimes. The owner at Campania's liked being buddy-buddy with his staff, but he was doing so at the expense of his business. He needed to buckle down and send people home when the restaurant was slow. As an owner, you have to make the difficult choices about your staff (including letting people go for the night, laying workers off, and firing staff) and you can't let personal feelings get in the way.

Always treat your job seriously.
Campania's staff, including the owner, were all playing like it was a big game, but the restaurant is in the hole $80K and that is not a laughing matter. It was time for them to get serious and make some money. The business was a passion for the owner, but he needed to get serious about his job and taking control of his staff or the business was going to fail.

Listen to your customers.
When people sat too long without food or attention, they became disgruntled. What did the wait staff do? The same thing they always did-fart around-which made the customers even more angry. By not being attentive to the customers needs and making changes accordingly, the restaurant was losing business. This same principle applies to any business: When you have poor communication with your customers, you end up with poor service and unhappy people.

Make a quality product.
The quality of the product should be able to stand alone. At Campania's, the food was nothing to rave about, so the word of mouth marketing potential was very low. When you make a good quality product, your clients will spread word about your company for you. A good quality product creates brand loyalty, word of mouth marketing, and powerful evangelism. Just look at how happy customers were willing to defend Campania's new menu when one customer got out of hand complaining in front of the restaurant!

Don't over-deliver.
Campania's profits were being eaten up by portion sizes so huge that every customer was taking home a doggie bag with a second meal's worth of food. This is basically giving every diner a "2 meals for the price of one" deal. It's fine to do your best and meet or exceed your customers' expectations, but don't give away so much that you are handing off your profits. If half of your work is done for free, you are not realizing your full business potential.

Create a strong marketing hook.
As Seth Godin says, everyone should be the best in the world at their own little niche. For Campania's, making a signature dish-The Best Meatball in New Jersey-was exactly the hook they needed to get people in the door. Once your business has a hook to reel potential leads in, you can show them what other services and goods you have to offer.

How to Have Better Business Meetings

Image is everything.
In business, you get to make a conscious decision about what you want your image to be, and then work towards projecting that image. For Campania's, this meant redecorating to create a polished look, working on food presentation to make a dinner into a fine dining experience, and reducing plate sizes to reduce portions while still creating a sense of value with the customers. In other types of businesses, this image might create feelings such as trust, personal service, or quality.

Provide incentives to increase profits.
At Campania's, they had a "server bingo" contest to see who could sell everything on the menu. The first one to do so received $100. This not only encourages the wait staff to sell more food, but also encourages them to push every item on the menu so that resources get utilized equally. A bonus or competition in any type of business is a good way to motivate your sales staff. Simple human nature says that by rewarding the top performers, you encourage the rest to perform better.

You can't please everyone.
Some people will complain no matter what you do-just look at the table that complained about ALL of the food being terrible while everyone else was having a good time. In the end, you can just agree to disagree and move on with a particularly problematic customer. Like Gordon did, it's important to not admit fault when you realize the customer is trying to find it. You can have empathy, but then move on.

Always move forward.
I wrote about this recently in my post Be Your Own CEO, but to recap: As an owner, you always have to think about moving yourself and your business forward. Campania's owner, Joe, got stuck on the small problems of his night. What he should have been doing was promoting positive leadership and moving forward. You can't change things that have already happened, so you need to move on and run your business in the best way possible.

Work on team building.
When Gordon is trying to motivate the entire staff, he talks about the problems and solutions in terms of WE, not ME or YOU. This creates unity and the desire to work together to make the restaurant better. By breaking the plates together in a symbolic gesture, Gordon helps the staff to feel like they are all responsible for the future success of the restaurant. By creating a positive team atmosphere, any business can create a strong sense of unity that will contribute to that business's success.

Get an outside opinion.
As a business owner, sometimes it's hard to see yourself with clarity. For Joe at Campania's, this was the greatest gift that Gordon could bring him: an outsider's opinion. I bounce a lot of my own ideas off the same friend who recommended this show. A good friend, colleague, or mentor can be an invaluable asset to your business whether you are struggling financially, weighing your options before making some changes, or just stuck in the everydayness of running your business.

Nikole Gipps is a web developer, marketing specialist, and writer. You can read more of her work at Small Business Essentials.

  • The biggest problem with Fox’ version of Kitchen Nightmares is that they try to turn up the dramatic aspects way more than they need to. If you get a chance, watch the original British version – Ramsey is still aggressive in his methods, but definitely comes off more as the restaurant business turnaround expert that he is.

    Aside from that, the biggest advantage of the British version of the show is that Ramsey comes back after several months to review how well all changes made have taken hold. The U.S. version makes this kind of consulting seem like a fire-and-forget one-time-only exercise. In the real world, the inevitable outcome of that approach is disaster.

  • I totally agree that follow-up is of vital importance … and that FOX Viewers in the US love their drama! They also tend to portray him as cold and harsh … when in reality he’s a loving family man as well as a restaurant business whiz. Thanks for the tip!

  • Lord

    I find him incredibly creative in how he approaches how to communicate with the staff. Rarely does he take the direct approach of telling them what they don’t want to hear, but finds a way to put them in the situation where they realize the problem for themselves. It is fun to ask oneself how one would go about this, and then see the course he selects.

  • I LOVE Kitchen Nightmares. It SHOULD be required watching for anyone with a struggling business or thinking about starting a business of any kind that deals with the public. I have blogged about it as it would relate to struggling retail stores in my industry. So many businesses are on the brink of failure but have no idea WHY they are failing.

  • I love this article.I’m running a restuarant.i hope these article Helps me to reach my goal

  • Kitchen Nightmares is starting to develop some buzz as one of the best how-to business shows on the web. Thanks for such a thorough post, Nikole. And thanks to Ironman for sharing info on the British version of the show.

  • NFB

    Strong analysis. I’ve watched all the U.S. Kitchen Nightmares and some of the British — great entertainment all around. Now, a couple years later, it’s interesting how many of the former Kitchen Nightmares restaurants are now closed. All the restaurants Ramsay visits are hugely in debt – I remember being curious, do so many places close because Ramsay didn’t help that much, or were they just so far in the hole already there was nothing he could do about it? I collected some data and wrote a short blog on the results. It can be found here:

    I’m just happy that even though all these episodes were broadcast years ago, Fox still left them on their website to view for free. I might be sending Rupert Murdoch some fan mail later for that