Restauranteur and Author Danny Meyer Reveals His Recipe for Restaurant Success

“The customer is not always right,” Danny Meyer exclaimed to an audience of NYU Stern alumni and MBA students. On November 6, Meyer, one of America’s leading restauranteurs, was at NYU Stern to discuss his book, Setting the Table: The Transforming Power of Hospitality, as part of Stern’s Fall Author Lecture Series. His lecture, hosted by Stern’s Office of Alumni Affairs, was followed by a book-signing reception.

According to Meyer, “While the customer is not always right, he/she must always feel heard.” Named one of the most influential New Yorkers of 2006 by New York magazine, Meyer, the founder and co-owner of 11 of Manhattan’s most influential restaurants, including Union Square Cafe, Gramercy Tavern, Tabla, The Modern, Blue Smoke, and Shake Shack, authored Setting the Table, his first non-cookbook, to share the lessons he’s learned while developing his recipe for restaurant success. He said that he didn’t set out to write a business book, but Setting the Table became just that, a book of advice and lessons he learned as the CEO of Union Square Hospitality Group.

Meyer said his business strategy is built on both good service, defined as the technical delivery of a product, and “enlightened hospitality,” which is how the delivery of that product makes its recipient feel. He argued that hospitality is the distinguishing factor for success in this new, service economy.  In the information age, competitors know how to offer the same products and services, but the culture and experience companies create for their customers will help them stand out. “It’s all about how you make the customer feel. You must make customers feel that you’re on their side,” he said.

To create this hospitable culture, restaurants must hire the right people, said Meyer.  He hires "51 percenters” – staff with a high “hospitality quotient (HQ)” whose skills are 49 percent technical and 51 percent emotional. The emotional skills that are required to create a high HQ are: (1) optimism and kindness, (2) curiosity about learning, (3) an exceptional work ethic, (4) a high degree of empathy, and (5) self-awareness and integrity.

Meyer reinforced that the first and most important application of hospitality is to the people who work for you, and then, in descending order of priority, to the guests, the community, the suppliers, and the investors. “By putting your employees first, you have happier employees, which then lead to a higher HQ. A higher HQ leads to happy customers, which benefits all the stakeholders. The cycle is virtuous, not linear, because the stakeholders all impact each other.”

Meyer’s management philosophy and techniques apply not just to the restaurant business, but to any business that is part of the service economy, or where good service offers a competitive advantage.

The next Author Lecture will feature William Silber on his book, When Washington Shut Down Wall Street: The Great Financial Crisis of 1914 and the Origins of America’s Monetary Supremacy, and will be held on January 30 at 6:30 p.m. in Schimmel Auditorium, Tisch Hall. For more information about this event, contact the Office of Alumni Affairs at alumni@stern.nyu.edu or (212) 998-4040.