In an innovative human resource move, the Rs 32 crore Java Coffee Company, owner of the Barista cafe chain, has introduced a stock option scheme for all its employees across the board.
The idea is to share wealth creation and benefit human capital. "By making them shareholders we are transferring ownership to the employees that makes them feel good," says Ravi Deol, chief executive officer.
He believes that Barista is an experiential brand and the way to deliver the experience is through its people, that is, the Barista team. He firmly believes that 50 per cent of the credit for good coffee goes to the person who makes it.
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Thus employee retention and high service quality becomes pertinent. "Even as we expand to other places we want to keep the passion alive. So how do we retain the spirit while ensuring the same service standards?" he asks.
The Employee Stock Option (ESOP) is not a substitute for compensation but it aims at driving collective ownership besides retaining the best talent in the business. The company has diluted 8 per cent of its paid up equity capital and the shares are being divested through a three year grant. "We have distributed 2,50,000 shares as stocks to the employees," says Deol.
But who gets what and how much? The ESOP model was designed by Arthur Anderson and the number of shares to be given away was based on the appraisal system. "Although Barista does not believe in hierarchy and everyone is treated at the same level, there are some key employees whom we want to retain at all costs. They are segregated by deciding factors like performance, criticality, longevity, potential and market value," elaborates Deol.
Among its other innovative human resource initiatives is the newly-launched Star Barista of the month contest. In this, the team at every outlet nominates a Star Barista based on performance, whose picture is then put up in a frame at the outlet.
This, the company claims, gives a real high to the person and is a monthly process. "If the same person gets nominated three times in a row, he gets a paid holiday for two," reveals Jyoti Mahendru, head Human Resources at Barista.
Deol feels that to maintain high quality standards, employee retention and satisfaction is key as a lot of effort goes into hiring, training and recruiting employees specially in the service sector. "In addition, when a consumer sees a familiar face every time, it cements the business."
According to Mahendru, out of the total strength of 250 employees, 214 people at the outlets are Baristas (or expert coffee-makers) as titled by the company. Keeping them happy and keeping them motivated so that they keep the customers happy is a challenge.
As these guys are on their toes for more than nine hours and have to have a genuine smile. So apart from offering them decent salaries, they have to feel important.
A bouquet on their birthdays with a card personally signed by Deol is another ritual here. "These are small excitements which touch them better," says she. Other things include first aid camps, insurance, mediclaims that the company takes care for its employees. For they believe that its the employees that make the company. "This is specially true in the service sector. We are very sensitive about the employees flexible timings, open communication system, consideration for working mothers," says Deol.
The company is busy stirring expansion strategies. The espresso coffee chain already has 38 outlets and targets 75 by this year end. An investment of Rs 40 crore has been earmarked for the same. The company is even planning to take its brand international shortly although plans are not firmed up yet.
A loyalty programme for their 20,000 consumers is also on the cards. "We will now focus on institutional areas first followed by high traffic areas like airports" concludes Deol.