Whether a merger of teams or a merger of companies, combining two cultures is challenging—especially when they're at odds. Cava Group CEO Brett Schulman knows this first hand.
In November 2018, the then-privately held Mediterranean fast-casual restaurant chain acquired Zoe’s Kitchen in a $300 million all-cash deal. The acquisition of Zoe’s Kitchen was an agonizing but transformative experience, says Schulman.
Cava was a fast-growing company with an aggressive startup spirit and several accolades under its belt. Meanwhile, although Zoe’s was three times Cava's size, it was a struggling public company that had recently faced layoffs and was suffering from financial difficulties and low employee morale.
"We were the minnows swallowing the whale," says Schulman. "It was a very painful experience in the sense that we were trying to integrate two cultures."
The deep despondency from Zoe's Kitchen began to weigh on Cava, and leadership quickly recognized the need to reenvision the culture and values of the newly integrated company, which the acquisition had strained. The company's mission is centered on bringing "heart, health, and humanity to food," says Schulman, and it wants employees to strive for constant curiosity and ambition.
Baking that purpose into a 10,000-employee organization, however, was a grueling undertaking. "I had black hair before we acquired Zoe's Kitchen," Schulman quips. "It's now grey."
Yet the experience provided a learning opportunity on how to not only scale an organization but also its culture.
"I can't be with everyone in this company every day or in every restaurant, right? So, philosophy alignment and creating a strategic plan are important," says Schulman.
Step one for the CEO was to put out fires. Through June 2019, Zoe's Kitchen was still rapidly deteriorating, and its financial losses and worker dejection were taking a toll on Cava. So Schulman and his executives gathered for a six-hour whiteboarding session to perform triage. His team peppered him with questions about his vision for the combined business, and by the meeting's culmination, they had synthesized Cava's immediate priorities into five pillars. That still wasn't enough.
Schulman was tasked with focusing solely on the top two priorities for Zoe's turnaround and delegated the other three to trusted leaders. "It becomes increasingly important the bigger you get to prioritize, simplify, and focus," he says. "Often what you say no to is as important or more important than what you say yes to."
Every week, the executive team met to discuss only those five pillars. "I told the team, 'This is all we're going to work on, and if you're working on something else, come talk to me because it's going to be an issue,'" says Schulman. By August 2019, revenue began to increase, he says, and by January 2020, "we were comping double-digit positive at Cava, and Zoe's put up its first positive comp since 2017."
Ruth Umoh
ruth.umoh@fortune.com
Today's newsletter was curated by Natalie McCormick.
