I first came across the concept of “Open Book” management (OBM) for restaurants back in 2009, when I purchased Zingerman’s Guide to Good Eating from a local food & wine retail client of mine and we were discussing their recent adoption of this business philosophy — first popularized by Jack Stack in his excellent 1992 book, The Great Game of Business. Having lived in Ann Arbor for 10 years and attended the University of Michigan, I was of course a fan of their world market and pricey-but-delicious deli salads and sandwiches. But it wasn’t until 2012, when I took a deep dive into restaurant accounting and attended a series of seminars by the former Restaurant Seminar Institute, that I made the deeper connection between healthy financial communication and healthy small businesses. The class instructor had referenced various approaches to management, and included OBM among others on the list. A year later, I began working with local restaurant Honey Butter Fried Chicken — whose owners, as it turns out, had taken Zingerman’s OBM course and were in the process of implementing it in their fledgling project.

I spent the next few years working with them as they fine-tuned their metrics, delivery, and compensation structures, as well as trained their managers and the rest of the staff on why any of it mattered. First-hand, the benefits of this transformative approach were made apparent, and I became an eager proponent of OBM. Later, as I began to specialize in co-ops, I saw the same lessons filtered through a lens of cooperative management and policy governance that in some cases fit nicely with the OBM framework (though not always — check out this excellent Columinate article on lessons learned the hard way; an illuminating quote: “Getting the responsibility into the hands of the staff each week is an important transition in making it successful.  Yet, many times, we see managers hanging on to the reporting lines for too long, which leads to disengagement and disinterest on the part of the staff. They won’t learn it or care about it until they are responsible for it”).

So imagine my delight when I read this month’s Plate online magazine and saw that my former clients are participating in a free webinar on Open Book Management — and how to determine whether it’s a fit for your restaurant! From PlateTalks: “These owners will talk about what it takes to get your books in order, how they share key data points with their teams, and what their staff has gained from the model.”

According to Zingerman’s — and this lines up with my personal experience — OBM can lead to better results: but more importantly, it lines up with the values of many small business owners. Side benefits include building commitment, better business decision-making, and teaching everyone to think like an owner.

Open Book Management isn’t something that can be implemented in a silo, however — a concept summarized well in a case study by the non-profit International Council on Hotel, Restaurant, and Institutional Education (CHRIE), “…small to medium enterprises can greatly benefit from open book management, the creation of a strong and qualitative mission statement, and a cohesive organizational culture that blends well with the external macro culture. Any one of these elements appears to be dependent upon another. For example, Zingerman’s, or any other company could have an open book management style of operation – but without a clear mission, the company would not do as well in the marketplace. Zingerman’s could have a great organizational culture, but without open book management, employees would not take ownership of their jobs, and therefore the bottom line would suffer.”

There are loads of articles and courses out there on Open Book Management — and plenty of restauranteurs who are glad to network and share their experiences. For a short introduction, I encourage you to check out Josh and Christine and their colleagues, as well as the folks at Plate, on March 5, 2024 from 1-2 pm Central. This is not a referral link — I’m just excited to get the word out, to help as many small business restaurants as I can in my time. I’ve always maintained — and as our mission goes — we believe the vibrancy and character of our neighborhood depends on thriving small businesses lending their unique vision to our communities.

---