“We’ve had eight CEOs in 13 years,” he said, flatly. “Does that bode well for the continuity and consistency (of the brand)? I don’t think so.”
Franchise Times
April 1, 2001
Protecting your King
What would entice a serious businessman to devote 75 percent of his time to an independent franchisee association and its beef with corporate
Nancy Weingartner
In 1967, Steven Lewis was faced with a dilemma. He didn’t consider himself a stellar student and college held no interest for him. “I knew I was going to get drafted and it made more sense to take control of my destiny,” he said. So instead of letting his country make the decision for him, he joined the Navy.
There was one small problem. Lewis had to pass a 50-yard swim test and he couldn’t swim. Somehow, though, he made it. It may not have been the prettiest 50 yards the boot camp had ever witnessed, but he didn’t sink.
You do what you have to do. “You make your own luck,” he claims.
Lewis learned about luck – and tenacity – at an early age. His first job was a paper route. And, if that sounds like a cushy assignment for a young kid, you haven’t been a paper boy in Minneapolis in January, collecting door to door in 30-below-zero weather, Lewis said. He still remembers trudging up to the front door in the frozen temperatures and being asked, “I don’t have $1.30, can you come back tomorrow?”
When life gives you potatoes, make French fries
In his junior year of high school, Lewis was cut from the baseball team. “I wasn’t happy, but it was time to get a job. I was sick and tired of asking my parents for money,” he said.
Burger King hired him and that short stint flipping burgers was the turning point in his life.
When Lewis got out of the Navy, he decided to give college a try, thanks to the G.I. Bill. One afternoon, he and two other college students were packing boxes at a plant. Near the end of his shift, he noticed that he had packed three-and-a-half boxes to their combined one-and-a-half. When he chided them to pick up the pace, they retorted that he needed to slow down because he was making them look bad.
He didn’t slow down; he quit. “Hanging around that attitude could affect you,” he said. “I didn’t want to develop a penchant for under-productivity.” College was once again put on a back burner, where it stayed.
Lewis decided to return to Burger King, only this time in management. The Burger King he had worked for in high school had been sold back to corporate. “I didn’t know the difference between a franchise and a corporate store then,” he said. The new manager had meagre people skills and as Lewis watched him handle problems badly, he started imagining what he would do differently.
“I knew that if I got into management, I wouldn’t make those blunders,” he said.
The best part of returning to Burger King was that he got paid while he learned. In addition to the correct french fry temperature and how to lead a crew, Lewis learned about team work and a commitment to a brand. “It’s important that you hold up your end of the bargain or the whole thing will collapse,” he said.
As Lewis went through Burger King’s training, he moved up quickly from assistant manager to general manager to district manager. The company moved him to Cleveland for a year, then New Orleans for two years and finally to Philadelphia as regional vice president.
In 1983, Lewis decided he’d had enough of corporate life. “I wanted to get away from the political winds,” he said. But even so, Lewis said the decision to leave was a tough one. “They had been good to me.”
As it turns out, he only had a relatively short break from the political winds as he and his partner Vernon Hill, a banker, began amassing their own Burger King restaurants, plus three other concepts. In 1985, when Lewis and Hill bought 19 restaurants from a franchisee, it was one of the largest franchisee-to-franchisee sales in the system. “It was a huge deal at the time,” he said.
1985 was a time of enormous leveraged buyouts, Lewis said. “We put the financing together and the next day we were $30 million in debt.” Lewis and Hill went on to acquire a total of 34 Burger Kings in the greater Philadelphia area and an additional seven in Atlanta with another partner. They also bought into Ponderosa Steakhouse restaurants, Rib-It and East Side Mario’s.
Running full-service restaurants is totally different from running a fast food operation, Lewis said. He bought into the Rib-It concept because he had been eating there since 1978 and “just loved the food,” His advice: “Whether you love it or not, make sure you want to run it. It’s much more complex.”
Even though there’s more than Burger King on their plate, the fast food restaurants are “an important cog in our wheel,” he said. That’s why when the direction of the winds at corporate changed, Lewis found himself swept into a position of leadership with Burger King’s franchisee association, the National Franchise Association (NFA).
Getting Involved
In 1988, when the NFA was formed, Lewis served as the representative from his region, the Northeast. He became a member of the marketing advisory committee and chaired it from 1993 to 1995. Not unlike serving his country, after his stint on the board, Lewis decided it was time to take a break from the national scene. After all, he had a business to run and he was starting over with a second family. During his career-building years, he felt he had neglected his family, and vowed that this time around he’d spend more time with his children,
And then he got a call from some of his colleagues trying to recruit him back to the cause.
“I talked to my wife – we had two young kids,” he said. “The time allotment (the national committee required) wasn’t what I signed up for or what she had signed up for.”
It took several conversations, but they both felt he was needed to help run the NFA. He ran for vice president and won in 1996, becoming president in 1998. Because of the magnitude of the problems with corporate, the board asked him to serve a third year as president. The time commitment is no small measure. Lewis estimates that about 75 percent of his time is spent on NFA business.
Taking a stand
The Burger King National Franchisee Association is one of the strongest franchisee groups in their category. About 90 percent of the franchisees and 80-plus percent of the restaurants belong, Lewis said. “The NFA is an effective association,” Lewis said, proudly. “Our association was created on a huge need for survival back in the late 80s.”
Any franchise community is traditionally a difficult body to get moving in the same direction, he stated. As independent business owners, they tend to be opinionated and strong-willed. But in BK’s case, the vast majority support the decoupling of the Burger King brand from the parent, Diageo.
“Our position is clear: The sooner the decoupling is complete, the better off we feel the brand will be. Initially, Diageo proposed a 20 percent IPO spin off. We remain opposed to that in light of the fact that they will continue to control the brand for an unspecified time,” Lewis said.
Part of the problem with the parent company, Lewis said, is that Burger King is not their main focus. “We want an owner who will nourish and take care of this brand…someone who will be singularly focused and who will put in the infrastructure and hire top-flight management to get this brand moving in the right direction.”
There’s a big difference in how corporate operates now and when he was an employee, he said. During the Grand Met/Diageo ownership, the franchisees have seen a thorough dismantling of the infrastructure and support from Burger King Corporation. This is the singular most important reason the franchisee association has become so strong. It’s filling the surrogate parent role.
“We’ve had eight CEOs in 13 years,” he said, flatly. “Does that bode well for the continuity and consistency (of the brand)? I don’t think so.”
Passion for the brand
When Lewis talks about the problems in the system, he never fails to return to his original viewpoint: “The brand is so great; it’s a huge icon in America.” Ask him about his newest restaurant, a 6,000-square-foot cyber café with a two-story, indoor playground, and the enthusiasm is so great, you can almost taste it.
“Steve’s the right person to be in his position at the right time,” said Fred Kaufman, a fellow officer on the NFA board; “He’s obviously committed to the brand; he’s demonstrated his passion for this business.”
Sure, Lewis might be described as “reasonably intense,” Kaufman admits, but “I think we all are. As entrepreneurs, we have everything at risk. Banks take repayment very seriously.”
Kaufman agrees with Lewis that “it’s helpful to be in a system that’s helpful.”
“But at the end of the day, you’ve got to make it work,” he said. “(With Burger King) there are times where they’re more help or less help. When you get help, it’s kind of a bonus.”
Lewis’ partner, Vernon Hill, said he also has a lot of faith in Lewis’ abilities. “This man has Burger King in his blood,” he said.
For his part, Lewis devotes so much time to the brand, not just to make sure his parochial interests are taken care of, but because he wants to see to see the brand succeed. In addition to serving as the president of the NFA, he also sits on the brand’s image committee.
“Steve wears a multitude of hats (in the organization),” said Jim Joy, vice president of Burger King’s North America Transformation and a regional vice president. “He does a good job of separating his role as a franchisee, as the chair on the image committee and as president of the NFA.”
Perhaps his greatest skill is to be able to switch gears and remain focused on the particular role he’s fulfilling at that time, Joy commented.
And, yes, Lewis does bring a lot of passion to his roles, but that’s not all that unusual with people who have been involved with a brand for a lifetime. “It gets into your blood,” Joy said.
New leadership, again
As the system gets ready to welcome its newest leader, John Dasburg, chief executive of Northwest Airlines Corp. – its third CEO in eight months – Lewis and his constituency are hoping the third time’s the charm.
Although Dasburg has a reputation of being tough on unions, Lewis said he’s not concerned that stance will transfer over to the franchise community. “He’s smart enough to know the difference between labor negotiations and franchisee relations,” Lewis said. “We have a huge investment in the Burger King brand and he’ll understand quickly that the franchisee community is not the enemy.”
Lewis is hopeful that the company will find a buyer and that they can all go back to serving food.
And for all his dealings with the company, they’ve never pulled surprise inspections or hassled his restaurants as a way of intimidating him. “Serving my customers in clean, well-run restaurants has always been my mantra.”
Giving Back
Because the company has given him so much over the years, Lewis wants to give back to the kids who make up his workforce. He’s set up a scholarship fund for workers who have overcome substance abuse problems and now want to go to college. He’s also involved with Project CARE (Chemical Abuse Reduced by Eductation).
When Lewis took that first job with Burger King back in high school, he never dreamed he’d be in the system all his adult life. “But, Burger King has been my life blood, it’s given me more than you could imagine.”
Sometimes you just have to get in the water and start swimming, even if you don’t know how. Giving it your all usually results in getting it all.”
“I’ve never had a bad day in a Burger King restaurant,” he said.
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