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By Verne Harnish
Dan Costello knew his family’s pizzeria chain and frozen pizza business, Home Run Inn, was treading water. His uncle John Perrino, who’d been CEO, passed away suddenly from a heart attack in July 2018. Costello took the helm as CEO a month later. With its team grieving, he recalls, “We didn’t do anything other than make the pizzas we had to make.”
By January 2019, Costello realized he needed outside guidance to rebuild momentum at the fourth-generation company –which started out as a tavern in 1923 and started making pizza in 1947. He reached out to Scaling Up Certified Coach Jill Belconis to apply the ideas in Scaling Up: Rockefeller Habits 2.0, which its nine-person executive team had read.
“We were very weak in systems and process and understanding what healthy teams need to look like and how intentional you need to be around it,” recalls Costello. “We wanted to know how to create a strategic vision you can align everyone around. We weren’t gaining a lot of traction on initiatives. We were having a lot of vagueness around commitments. I felt like I needed help in terms of being able to help craft the message and the processes we needed to achieve those things.”
Fast forward to today and the 500-employee company, based in Woodridge, Ill., is thriving and profitable, with annual revenue just short of $100 million. Home Run Inn operates nine restaurants in the Chicagoland area and sells frozen pizzas in 40 states across the country. Here is how Costello and his team used the Scaling Up platform to rebuild the company’s momentum.
Connecting people to KPIs
The first step to reigniting the company’s spark was getting the right people in the right seats on the bus. Costello and his leadership team first defined the company’s Core Values—family, pride, grit and courage. That helped them get clear on the values they were seeking in people they hired and retained.
Then they set to work on the Function Accountability Chart (FACe) from the Scaling Up platform, deciding which line items on the company’s profit & loss statement each was responsible for and assigning key performance indicators (KPIs) to support them. Each person was, in turn, responsible for tracking three or four of the KPIs under the functions for which they were responsible. “We were able to be very clear on what we wanted and needed in those roles,” says Costello.
Completing the FACe led to some personnel changes, including the departure of three key team members. Fortunately, the company knew what capabilities to seek in their replacements. “We were able to fill those positions,” says Costello.
Crafting a strategy
Working with Belconis, the leadership team created a three-year vision and a one-year goal, using the One-Page Strategic Plan. They also set quarterly goals—all pegged to KPIs—and asked department leaders to do their own One-Page Strategic Plans, connected to the company’s version.
A big part of the vision at Home Run Inn is to be a multi-generational family business. “If we can make this a place where our wives and husbands would like their kids to come work in the company, that’s a Big Hairy Audacious Goal for me,” says Costello.
To make sure everyone in the company is aligned around the company’s vision, there are weekly huddles for the executive team, daily huddles for the manufacturing team and huddles within each restaurant or store in the morning and again at the start of the second shift.
Finding a Flywheel
As part of its strategic work, the company also identified its Flywheel—the steps in the business cycle that lead to continuous growth. “The thing we do that our competitors can’t do is we’re the only frozen pizza company in the top 10 nationally that ages their dough and hot presses it in the manufacturing process,” says Costello. “That’s what makes us unique. The other thing we do that only one other competitor does is operate restaurants. They give us a direct relationship with consumers that you can’t get through the frozen pizza business.”
Beyond its unique handling of pizza dough, the company also “parbakes” its frozen pizzas, stopping the baking process 80% of the way and freezing the pizza with sophisticated technology. Competitors simply take a frozen crust, add sauce and toping and wrap it—without cooking anything together. “When you build your strategy, you do it on things your competitors can’t or won’t do,” Costello says. “We figured out how to design our manufacturing system based on how you make pizza in a restaurant.
Bringing the strategic plan to life
To make sure Home Run Inn is executing well on its quarterly goals, Costello and his team track KPIs such as the company’s favorability score with customers, using an internal survey; they also use software that incorporates all the reviews on Facebook. This data gets discussed in the executives’ weekly huddle.
They are careful to include—and answer—the questions “Who? What? When?” in each executive huddle. “If you’re not explicit and specific about who owns what, you’ll come back to the next meeting and say, ‘We didn’t accomplish as much as we thought we would,’” says Costello.
By getting clear on its strategy, the company stopped chasing opportunities that were not making it money, says Costello. That helped preserve cash. “Our financials improved dramatically,” Costello says.
In keeping the company moving in the right direction on many fronts, Costello is well on his way toward creating a business with the potential to continue past four generations of family ownership. His daughter—a member of the fifth generation–already worked there part-time over the summer. “We want it to be a place where people can grow,” Costello says.