In this era of rapid turnover and spotty service, a quick-service restaurant chain based in Rosemead Calif., believes in a unique approach to staffing and basic business concepts.

Panda Express has its roots in an upscale, full-service restaurant named Panda Inn. Using his chef father’s recipes, Chinese immigrant Andrew Cherng established Panda Inn in 1973 (there are now six full-service restaurant locations). His idea for quick-service Asian restaurants took shape in 1983 and led to the creation of the largest Asian restaurant chain in the country. In 2007, Panda Express opened its 1,000th location in Pasadena, Calif., and achieved $1 billion in revenue for the first time.

Parent Panda Restaurant Group also includes more than a dozen Hibachi-San locations, featuring Japanese grill items in a quick-service setting. The success of the company is attributed to its position as an “outstanding employer” and to its personnel, as seen in its mission statement: Deliver exceptional Asian dining experiences by building an organization where people are inspired to better their lives.

“We’re in the people business first; the restaurant and food service come after that,” says Linda Brandt, chief people officer for Panda Restaurant Group and leader of its human resources department. “We believe that we would be unable to meet our financial and guest expectations if we didn’t put our associates first. Putting people first gets long-term results.”

Panda Express’ culture is viewed as a conceptual pyramid supporting growth, with associates first, followed by guests and financials. This is the foundation of everything the company does, Brandt says, and “the people then drive the guest experience and we get the financial result.”

The Panda Express approach to training is different from that at virtually any other quick-service chain. “It’s experiential,” Brandt says. When restaurant managers come to work for the company, they must complete a field training program that is hands-on and skills-based.

The unique part of the process for Panda Express managers is the series of classes that they attend throughout the first year of their training at the company’s support center. “When our associates come to classes, they don’t usually sit at tables,” Brandt says. “They’re usually sitting around in a circle. We believe that we develop leaders and personal self-awareness in these classes.” The thinking is that if associates learn more about themselves, they will be more effective leaders.

The company also emphasizes personal fitness and wellness, and has relationships with fitness companies across the country where associates can get discounted rates. Physical activities such as hiking are also part of the training associates receive at the company support center. “We try to look at the whole person,” Brandt says.

Compared with the quick-service segment overall, turnover at Panda Express is relatively low. Annualized turnover for general managers is running at about 18 percent through the first half of the year, and turnover among hourly staff is around 72 percent, Brandt says. Hourly turnover was around 110 percent in 2007. “I think the industry average is about 150 percent,” Brandt says.

The organization focuses on two areas to improve associate longevity. The first is making the right initial hiring decisions. A proprietary selection tool that includes the competencies the organization seeks is used in the hiring process.

Hiring is a group process for Panda Express; potential associates “do an experience” in restaurants during the selection process. Hires are made by the restaurant operator, who receives support from Panda’s human resources department. “Without the operators’ doing the right things, we would have very high turnover,” Brandt says.

Daily mantra for store associates
Each day, Panda Express associates consider four questions while going about their daily tasks: “What is the good business reason for doing whatever it is that I’m going to do?” “Did I add value today?” “What can I do to make things better?” and “Would I recommend what I do to someone else?”

The company also offers “tremendous opportunity for career advancement,” Brandt says. “Seventy percent of our general managers have been promoted internally,” and everyone at the multi-unit level, such as supervisor or district manager, has been promoted internally.

Panda also has the carrot of strong growth, which creates spaces for associates to advance. “We built 170 restaurants last year,” Brandt says. “That is 170 opportunities for general managers, seventeen opportunities for area coaches and additional opportunities above that. It’s a fairly significant thing for people to have the opportunity to advance.”

Orange chicken has been Panda Express’s signature entrée for 25 years. Other popular menu items include broccoli beef, sweet and sour pork and chow mein. These dishes would not be possible without the chefs at Panda Express, who are highly valued.

“Our chefs are really the core of the quality food we provide” and undergo initial training at full-service Panda Inns, Brandt says. “We are very particular in their training and very particular in the detail around what they do.” All menu items are prepared fresh in each restaurant, making the chef’s role very important.

“We depend upon our chefs tremendously to transfer their knowledge of Asian cooking to our associates who didn’t grow up learning how to cook Asian food. Our chefs are cherished in our organization and are at a level with senior leaders in operations.”

Component of company culture
A core value for Panda Restaurant Group is giving, both to self and to the community. Panda Cares, a charitable arm of the organization, is one way the company and its associates give back. “We have an expectation that each of our restaurants will do at least one event a year where they provide food or support for charitable activities,” Brandt says.

The company supports Children’s Miracle Network; when associates donate to the cause, they are supporting the hospitals in the cities where they live and work. Other charitable activities include disaster relief. “Giving is truly an inherent component of our culture,” Brandt says, “and I would suggest that if a person does not have this as part of their being, they are not going to feel comfortable working at Panda.”

Brandt attributes a good share of Panda’s success to the organization’s culture of continuous learning. “We are not stagnant,” she says. “We are always trying to look at the next book, look at the next leadership opportunity, learn about the next thing.”