Rules of Engagement
Jamba Juice keeps its employees by showing how they contribute to the chain’s profits.

By Margaret Littman

Cherlene Bauzon has been offered a promotion, but she prefers to stay put. This June will mark her fourth year at a San Jose, Calif., Jamba Juice store. She’s worked her way up from team member to team leader. She now holds the keys to open and close the store and handles the cash drawer and customer questions.

Bauzon is not afraid of challenges. She was promoted within six months of her initial hire and has taken to some of her manager’s initiatives, such as having the entire team involved in the store’s hiring process, with relish. But the 22-year-old turned down a promotion to assistant manager.

“That would mean I would have to leave my store, and our team has built a family inside our store. This is a special kind of place,” she says.

Most restaurant managers would give their eyeteeth to have just one hourly employee like Bauzon, who left a second job at a casual-dining chain because her experience was inferior to that at Jamba Juice. But, according to accounts from People Report and others, Jamba Juice has plenty of hourly employees like Bauzon—possibly as many as 6,800. Bauzon says the only reason her co-workers quit their jobs is if they are high-school students who move away for college. Otherwise, folks keep serving smoothies, like Bauzon, while they take classes, become parents or work second jobs.

Jamba Juice’s hourly turnover rate is 30 percent better than that of its competitors, according to Russ Testa, vice president of human resources for the San Francisco-based concept. In addition to being among the top 20 percent of People Report survey respondents in the category of hourly-employee retention, in 2004 the National Restaurant Association Educational Foundation gave Jamba Juice the Winning Workforce Award for “enhancing employee satisfaction.”

People Report bestowed its annual Catalyst award on the company last year because it was clearly ahead of its peers in reducing turnover of both managers and hourly workers while diversifying its employee base, says Shyam Patel, senior research analyst for the organization.

“It is a quantitative award, and they clearly came out on top,” explains Patel, who evaluated retention performance between second quarter 2003 and second quarter 2004.

Avoiding Turnover Turmoil
“Jobs in our industry are hard jobs. They are physically taxing,” concedes Testa, who joined the $260 million company after 10 years at the Mervyn’s department-store chain. “Because it is hard, the environment, how you are treated and your relationship with your supervisor, is what determines if you’ll stay.”

To keep its 7,500 employees happy, Jamba Juice developed a training and management program that makes hourly workers an integral part of the QSR’s performance. The crux of the program is F.I.B.E.R.: Fun, Integrity, Balance, Empowerment and Respect.

While both Bauzon and Testa mention “fun” as one of Jamba Juice’s core values, the environment isn’t one where employees play improvised basketball with the trash can while forgetting to refill the napkin dispensers. Instead, these are folks who use a “communication board” to leave notes to the next shift about what should be of concern that day.

In addition to the input the entire team has on hiring, Bauzon says she and her colleagues feel empowered in other ways. For example, team members don’t need permission from a manager to give a dissatisfied customer a free mug (designed by a co-worker as part of the Team Member Mug Design Contest to benefit the American Cancer Society) or smoothie.

“It is not only [team] leads and management, but everybody is aware of everything, even food costs,” she says.

All Aboard
The empowerment efforts go beyond placating the disgruntled and reducing food waste. When the chain launched a 16-ounce smoothie line in late 2003, it wanted employees to understand the new recipes and the different approach to boosting sales, emphasizing repeat business over a higher average check. Jamba Juice instituted an extensive training program, complete with an analysis of how the smaller size would affect profit and loss statements.

“This was a pretty large change for our concept. We wanted our team to feel engaged in the business and to understand the way we wanted the product to perform,” explains Testa, who adds that management is pleased with the boost in business from the smaller size product line.

The launch of two new yogurt-blended morning smoothies included another effort to engage employees in the concept’s business plan. Last October Jamba Juice donated 25 percent of proceeds from the new breakfast menu to PE4life, a nonprofit that works to improve physical-education programs in schools. The three-week promotion raised $50,000 for the program, reinforcing the company’s commitment to health and community service, which is an integral part of the corporate mission.

To keep employees happy, Jamba Juice’s training and management program emphasizes F.I.B.E.R.: Fun, Integrity, Balance, Empowerment and Respect.

When the funds were donated to PE4Life, 50 percent went to the Washington, D.C., headquarters, but the remaining was allocated to high schools in the local markets where the stores are. This component of the program helped show workers how their stores affect their friends, family and neighbors in the community.

Another benefit: Jamba Juice grants each employee an eight-hour day off from work for every 32 hours he or she volunteers for a local charity.

More F.I.B.E.R. in the Diet
Testa and his management team are convinced that the F.I.B.E.R. philosophy is having a quantifiable impact on corporate performance. Systemwide sales for Jamba Juice increased 24 percent in 2004 to $260 million, while average unit volume, which the concept does not release, climbed 8 percent. Jamba Juice only recently began tracking its retention efforts, so Testa cannot provide concrete turnover numbers for the last few years but is confident that “the brand is gaining momentum because people are proud to work here, and that helps with retention.”

And retention has an impact on sales. “The more experience and skill you have in a store, the better customer service you have. Having people being experienced in your stores means they understand the job better,” he says.

With 478 units and plans to open another 80 by year-end, Jamba Juice is in aggressive growth mode. That growth has not hampered consistent hiring practices. Rather expansion helps recruit and retain the right employees, people who are “able to live the values of the company, take the job seriously but not themselves too seriously and create a fun environment,” Testa says.

“I think people want to be part of a healthy, vibrant, successful concept. If you are not very successful, you are not growing. Growth makes them feel more proud to be here,” he adds.

Bauzon agrees. She applied to work at Jamba Juice because she had several friends who enjoyed working there. Thinking back on her other restaurant jobs, with managers who couldn’t adjust work schedules for an employee’s school schedule, she says, “Jamba Juice is very open-minded.”