Simplicity is difficult to achieve. Complexity works its way into our relationships, the way we communicate, the way we frame problems, and the solutions we build. Complexity creeps.

Simplicity is a difficult pursuit but it has immense value. Relationships of all types are complex but their foundations are simple; respect, empathy, friendship, kindness, love. Communication that is clear and concise achieves its end better than run-on sentences peppered with acronyms and jargon. Solutions too, are best when they are simple.

Traditional business logic trends toward building more; offering more features than the competitors. More does not equal better. Complex solutions to the original problem produce new problems. A system designed to reduce costs and save time is ill served if it replaces time saved with new admin and maintenance tasks.

The advantages of simplicity as a business strategy are framed nicely in “Blue Oceans”, a book I’d recommend to anyone building a product, starting a small company, or competing in a large market. Red Oceans are where the monsters swim and to compete you must outperform by offering more features, faster, and for less. Blue Oceans offer opportunities for solutions with less competition because they approach a problem from a unique perspective, they operate outside the boundaries of existing markets where competition is smaller and there is room to grow.

One way to place yourself in a blue ocean is to tackle complexity. What is everyone else doing that we can cut? Which solutions or features taken for granted by your competitors can be eliminated? If you just don’t do those things, what opportunities does that open for you? Can you reduce the costs of your solution and maintain the value to your customer?

Here is an example from one of our products; BlackFox helps restaurant operators manage their sales, cash, and tips. One of the questions I get a lot from prospective customers is, “Which POS systems do you integrate with?” The resulting conversation is a good one; where I say that we don’t integrate with any POS systems and explain why that’s a good thing.

Every restaurant has a Point Of Sale system. Not integrating with POS systems was a key design decision, a choice for simplicity over complexity that benefits the product in several ways;

• BlackFox is agnostic - it doesn’t matter which of the dozens of major POS systems a client uses or which version they are running, BlackFox works with every POS there is!
• Reduce set-up and costs - Integrations cost development time that increase the price of the product and they take time to set-up
• Eliminates errors - There a myriad of ways staff can mess up entries in the POS, like closing to the wrong payment type. While I’m a fan of data capture there are benefits to placing a human break in the machine chain. Why would you want to perpetuate errors all the way up your business chain until some of the highest paid people in the organization, bookkeepers and accountants, have to correct it?

Simplifying design comes with trade-offs. You can’t get something for nothing, but when we analyzed the down-sides to not pulling data directly from the POS it cost a manager 60 seconds a day. One minute each day is required for a human to review the POS numbers and enter them into the system. It was a huge win at a minimal cost.

Complexity creeps. It takes work to produce simplicity and the war against complexity never ends. Instead of trying to outpace the competition by offering a better solution to the given problem redefine the problem. Look for a solution with the smallest footprint that addresses the issue. What is everyone else doing that offers little value? What advantages are there to just not doing that?

A third of restaurant operators are concerned about the future. It’s easy to see why. Half of foodservice companies are losing money or breaking even. Restaurants visits continue to trend downward and while total spending is on track to be 10% higher than 2022 that increase has been more than consumed by rapidly rising costs. Bankruptcies in the first half of the year rose by about 50 per cent compared to the same period last year. An industry that has always had tight margins is struggling to find any profit at all.

We’ve collated potential solutions from a number of sources. Here are some areas that may offer some relief.

Refining Menus - Look at menu options with an eye to reduce costs by speeding up and simplifying the newly vital delivery orders, cutting back the demands on the kitchen in this tight labour market, eliminating high price ingredients, and reducing food waste. You may be able to continue a commitment to quality and choice while reducing costs.

Delivery Services - They take a big chunk off the top of the revenue they generate but they may still be worth the effort. It’s harder to generate a profit with these sales, but it helps pay for your kitchen staff and your utilities. The additional revenue can help you hold onto hard to replace staff and offset fixed costs, and that can be enough to get you through slow periods and let you fight another day.

Technology - Restaurants Canada tells us that restaurateurs believe that investing in labour-saving tech can help with staff costs but that the cost of implementation can be a barrier. Look for technology that streamlines your day to day activities without adding additional administration or management. Low set-up costs and ease of use are key to adopting new tech that reduces staff overhead.

Sources

• Restaurants Canada - Challenges shaping the industry
• Restaurants Canada - Profits remain elusive
• Restaurants Canada - Half of owners are pessimistic
• Globe & Mail - Restaurants struggling

BlackFox

Helps complete your daily restaurant cash-out process in as little as 15 minutes. Save 30 minutes of admin time everyday!

I am working on a new feature set for one of our software products. I find myself deciding to be opinionated in the way these features are implemented. That’s a tough call, I’ve found restaurant managers to be opinionated themselves, and stubborn. You are bound to battle with current customers and alienate prospects, but I think it’s important. As a designer and Engineer that’s part of what you have to offer; decisions.

I mean, who wants to collate dozens of “tip management spreadsheets” and distill them to develop best practices and specific solutions. Managers going about their day don’t have the time or the interest. Doing a “deep dive” on a specific problem that many people in an industry experience should produce opinions. Share them! Implement them! Or what did you do all that work for?

There is no point in building a completely agnostic solution. It’s important to have opinions. Not everyone is going to agree - you can’t please everyone - but without opinions you cease to be a designer of solutions and become a request filler.

Most restaurant bills are paid with electronic money - credit cards dominate. The restaurant pays a 1 - 4% fee to the bank for the privilege of taking credit card payments and therefore is paying a fee on any tips left on credit card - the primary way most customers pay. Restaurants are stuck paying a transaction fee on money they never receive.

If a customer leaves a server a $100 tip on credit card, it costs the restaurant $2 to process that transaction. It may seem fair that the server only receives the $98 remaining; the server should pay the credit card fee. Fairness, as represented by the law, varies wildly across Canada.

It is legal in Ontario for an employer to recover credit card processing fees from tips prior to distributing them to employees. In British Columbia that is strictly forbidden. Manitoba and Newfoundland side with Ontario. New Brunswick, PEI, and Quebec are with BC. The remaining provinces are silent or vague, not having laws specific to this issue.

What’s at stake are thousands of dollars in fees in an industry that averages just 4% profit. For multi-unit operators credit card fees on tips can quickly climb into the 5 or even 6 figure range. It’s vital to know what approach you can take in the region(s) you operate.

We’re implementing a new feature on BlackFox to allow for the recovery of credit card fees on tips (*where allowed by law).

Sources

Ontario Guidelines

Alberta Guidelines

Restaurant Canada - Tipping Rules in Canada

If you have a business that deals in cash, like a restaurant, part of managing the day’s sales is counting change. At restaurants and bars all the front of house staff collect change throughout their shift, and wow do they love to dump that change into their nightly cash-outs! Most restaurants establish rules to prevent staff dumping change in their cash-outs because they don’t want a pocket full of change, and managers don’t want a bunch of cash-out bags full of it - change is a pain.

I swore to do away with change in my restaurants. It’s one of the clever things I designed into BlackFox; all cash exchanges are done in even dollars, no one using the system ever has to count nickels and dimes. BlackFox treats employees like friends we will see tomorrow. You owe us $10.45? That’s cool, give us the $10 and we’ll deal with the $0.45 next shift. So much easier for everyone.

It’s a small thing, but small annoyances and little inconveniences add up quickly when it’s a task you have to do every single day. BlackFox eliminates the need for staff to drop change in their cash-outs, which means the manager saves a few minutes by not counting and organizing a dozen bags full of change in the morning, and your bookkeeper doesn’t have to deal with daily reports that are out of balance because of mistakes made counting literal pennies. Grease the machinery used by minimum wage staff to perform their daily duties and the engine of the entire organization runs more efficiently.

Canadian Restaurant Association recommends setting up a staff run tip committee. The committee meets on a regular basis, decides on the strategy for calculating staff share of tips, and distributes the tips to individuals. A tip committee takes the employer out of the equation and fits the definition of “direct” tips. Without this step money flowing through a tip pool can be deemed “controlled” and therefore subject to EI and CPP.

Creating a Tip Committee

It’s important that your Tip Committee is run by the staff. To eliminate liability you want to remove any indication that the restaurant “controls” tips. Find at least 3 staff members willing to serve on the committee and represent the staff as Directors of the Tip Committee. You will need staff buy-in to this process so begin here; a nomination and vote procedure at a staff meeting is a good start. The business wants to reduce liability so it’s important to document the operations of the Tip Committee, beginning with the appointment of its directors.

Now that you’ve got staff representatives, their first order of business is establishing and documenting the rules and guidelines under which they will operate. They should meet some basic requirements:

1. Committee must meet regularly - at least once a year - where they fill vacant Directors positions and decide on rules for tip distribution

2. Communicate the tip sharing rules to the rest of the staff and have them sign an agreement that documents their approval and participation in the tip sharing arrangement. They will need a standard form for all new employees to sign.

3. Document tip distribution and share these documents with the restaurant for retention in case of an audit

Once your committee is established and a signed collective agreement is reached by the staff its time to empower them to enact their plans. They will need access to cash to cover the tip pool balance and the data required to calculate tip share (usually time sheets).

BlackFox provides the tools for your committee to implement a tip-out policy, collect and track the tip pool, distribute to staff based on the chosen rules, and BlackFox documents the entire process for you.

References

Canadian Restaurant Association - Tips, source deductions, and how to protect yourself from liability Part 1 & 2

• Part 1
• Part 2

If the Canada Revenue Agency (CRA) deems the tips coming through your restaurant are “controlled” you are on the hook for employment insurance and Canada pension plan for those tips. They must be declared as restaurant income and the tips must be included on the employees T4 slip, along with source deductions including the restaurant’s contribution. The majority of Canadian restaurants are implementing a tipping model the CRA would consider controlled tips and it comes with significant liability.

These are all common practices in the Canadian Restaurant industry that result in “controlled” tips:

• mandatory service charge - many operations implement a mandatory gratuity on larger tables.
• tips allocated using a formula determined by the employer - all Tip Pools! Most restaurants collect and distribute a tip pool that is shared with Kitchen and support staff.
• tips turned over to employer who then distributes to employees - this is all electronic (credit / debit) tips! The CRA has made this somewhat helpful clarification, “an extension of this position would be where an employer might for cash flow reasons, delay paying out the tips to the workers until the next day.”

How to run a Tip Pool

Every client we have uses some form of Tip Pool to share tips with Kitchen and Support staff. This is a key source of liability to the restaurant. All money flowing through a tip pool can be deemed “controlled” and therefore subject to EI and CPP. It’s important for restaurants to look at ways of reducing this liability.

The best practice is to put in place a staff run tip committee. The committee meets on a regular basis, decides on the strategy for calculating staff share of tips, and distributes the tips to individuals. A tip committee takes the employer out of the equation and fits the definition of “direct” tips.

References

Canadian Restaurant Association - Tips, source deductions, and how to protect yourself from liability Part 1 & 2

• Part 1
• Part 2

Cassel's PDF

“In Ristorante a Mano Limited v Canada (National Revenue) (Ristorante a Mano), the Federal Court of Appeal (FCA) held that electronic tips are subject to CPP and EI and the restaurant (i.e., the taxpayer) had an obligation to pay employer contribution amounts of CPP and employer premium amounts of EI to the Canada Revenue Agency (CRA). In Ristorante a Mano, the restaurant operated under a standard tip arrangement within the restaurant industry.”

KPMG White Paper

“The courts dismissed the taxpayer’s appeal and confirmed that the tips, which the taxpayer received from customers’ electronic payments and subsequently paid out to its servers, constituted CPP contributory salary and wages and EI insurable earnings because these amounts were paid to employees in respect of their employment.”

Collecting tips into a pool of money and distributing the funds to staff is a standard practice in the restaurant industry. The method of deciding what share of the collective tip pool is distributed to each staff member varies widely. We’ve been collecting the spreadsheets operators use to distribute tips to their staff for years and have identified 3 primary methods of tip distribution.

1. Equitable Tip Distribution

The simplest and arguably the “fairest” method is to distribute tips proportional to the hours worked, regardless of position or seniority. If the dishwasher, the prep cook, and the sous chef all work the same number of hours, they share in the tips equally.

2. Ranked Tip Distribution

Operators often want to incentivize some roles over others. It’s more difficult to find a talented and reliable Grill Cook than it is to hire a new Dishwasher. Offering those difficult roles, or staff with seniority, a larger portion of the tips helps attract and retain talent. In this strategy tips are distributed to staff based on hours worked in a role multiplied by a distribution factor for that Role. If the dishwasher, the prep cook, and the sous chef all work the same number of hours, the dishwasher receives a smaller share and the sous chef the largest.

3. Allocated Distribution Strategy

Some restaurant operations choose a team oriented strategy. Staff are divided into various teams; Support, Management, Back of House. Each team is allocated a portion of the house tip pool and staff in that team divide their team’s allocation by hours. The Host and Expo would share the Support team’s 20%, floor managers would split 20%, and the BOH would divvy up the remaining 60%.

4. Hybrid / Frankenstein Strategy

The above three strategies are the most common, but some operations choose more elaborate methods, often combining the common approaches into a hybrid. These strategies are complex by nature and less transparent as a result. The distribution of tips are hidden behind layers of Excel formulas and are difficult to communicate and implement, which strains relationships with staff and often runs afoul of labour laws.

It’s worth noting that the selection and implementation of any tip strategy by management of a restaurant can cause Revenue Canada to label the tips as “controlled”, an important distinction that can lead to significant liability - the restaurant can be retroactively held responsible for wage source deductions like employment insurance and pension plan contributions. Your best protection is to implement an employee run tip committee that decides on the strategy and implements the tip distribution.

We’ve built the three most common strategies and the ability to turn tip distribution over to a staff run committee into the Teams version of BlackFox. Which provides advanced features to manage tip pools and new cash-less options for tip pay-outs by integrating with the Today card.

Tipping is a part of restaurant dining in North America, for better or worse. As a diner you tip your Server and they are expected to share some of those tips with the other staff. Servers and Bartenders are the front line staff that interact with the customer, but they are only part of the team that delivers your dining experience. The team members in the kitchen and the assistants up front are integral cogs in the service machine and a significant part of their earnings come from tips that are shared amongst the staff.

The distribution of tips is known as a “tip-out”. At the end of their shift a Server or Bartender contributes a percentage of their sales to a group tip pool which is collected and distributed by management. There are no industry standards or government regulations regarding what percentage this tip-out is or how it is distributed.

Canada’s restaurant industry generates 70 Billion in revenue, subtracting the 46% that is fast food dining where tipping is not standard practice, you are left with $38 Billion in Sales that customers tip on. Canada’s average restaurant tip is 17.2 per cent, generating $6.5 Billion in tips. A typical Canadian Server or Bartender will be required to contribute at least 5% of sales to a community tip pool, that’s $1.9 Billion in tips being managed by Canadian restaurant owners and operators with no oversight. The US figure is 10 times that.

How would someone working in a kitchen know if their employer was distributing tips equitably or even skimming money off the top? The short answer is that they wouldn’t. There is not even consensus on what constitutes “fair and equitable” distribution of a tip pool.

My company manages staff tips for restaurants and for years we’ve been collecting the spreadsheets operators use to distribute tips to their staff and I can attest that there is no standard for how that calculation is done. The simplest method is to disperse tips proportional to hours worked, but some operators first carve off a piece for the “managers”, some operators reward some roles over others; the cooks get a larger portion than the dishwashers, some operators favour seniority; seasoned cooks get more than the newbies, some restaurants divide staff into groups and then assign arbitrary portions to each group; Support staff share 20%, the Kitchen shares 60%, and Managers take 20%. The distribution method is the prerogative of the restaurant operator, it can vary wildly even between restaurants within the same franchise, and it is all hidden in spreadsheets in the back office which few employees ever see. There is little to no transparency in the process, and given human nature, that means millions of dollars is being mismanaged, diluted or siphoned from low wage employees.

We are in the process of developing a distribution system for tip pools. Transparency, I believe, is a vital element to that process. The food and beverage industry is experiencing a labour shortage. Kitchen staff are particularly in demand, so they have more employment choices than ever before. Employers and staff both benefit from making the distribution of tips a fair and transparent process. It’s another recruitment tool for employers desperate to attract talent and being treated fairly inevitably feeds employee job satisfaction; it is, after all, their money.

I would love to hear about staff experiences with this issue. We’re also still collecting tip distribution spreadsheets in search of common threads, and I’d appreciate it if you had one to share.

Cash is disappearing

Cash has been losing favour as a payment method for decades and the restaurant industry has slowly been transformed by this changing reality. Debit and Credit was used 85% of the time to pay restaurant bills in 2019. The pandemic has accelerated this evolution and virtually eliminated cash overnight.

Restaurants have been forced into acting as a bank for their employees. Most operations now find themselves routinely going to the bank to take out thousands in cash to distribute tip-out to their staff. Is this you?

BlackFox & Tipstoday to the rescue!

BlackFox will manage your cash-outs and tips like always, but now you have the option to issue tips to staff using Tipstoday. Staff are issued a card and you load it up with money directly from BlackFox. Staff use it just like a bank card and the only costs to staff or the restaurant is the initial purchase of the card. 

Modern problems require modern solutions. We're excited about the new Tipstoday integration and think it will make your day just a little bit easier.

How do you distribute your Tip Pools? We’d love your input on our new tip pool distribution feature!

Buckets full of (electronic) Cash!

Restaurants have always collected a Tip Pool for the Kitchen staff, and every week or two it gets distributed to the hard working crew in the back of house. The pandemic has forced the industry to rethink their method of operation and so we are also seeing an increase in Tip Pools being collected for front of house staff. Management is now handling the collection and distribution of thousands of staff dollars in multiple buckets.

Gangster Stacks

This was all once done with cash. Remember cash? That’s a historical relic now; most transactions are electronic. Restaurants have been forced into acting as a bank for their employees. Most operations now find themselves routinely going to the bank to take out thousands in cash to distribute tip-out to their staff. Is this you?

Management and distribution system for tips should be electronic too. Managers need simple tools that accurately and quickly manage tips and their distribution, and it shouldn’t require regular withdrawals of gangster stacks of cash. We need to solve these problems while also building trust with staff, who want transparency in how their money is distributed.

What's your tip distribution formula? 

K.I.S.S. (Keep It Simple Stupid)

The simplest and most common method is by hours worked. If you distribute tips weekly a staff member’s portion would be their hours worked (x) divided by the total hours worked by the whole crew (y). Are you using the simplest solution?

Spreadsheets are fun!

It’s tempting to make things more complicated. Perhaps the crew that works a busy Friday night deserves a bigger cut than the Tuesday lunch bunch. This method requires you track tips by the day or shift that they are collected. The math is essentially the same, except now you are doing the calculation each day. More complex, but easily accomplished with a spreadsheet, although it is more data for the manager to collect and harder for staff to understand. Are you using a hybrid method to fine tune tip distribution by day or shift?

X-Factor

If you really want to feel in control, maybe you add an “x-factor” into your tip distribution system. Perhaps the experienced line cook deserves a bigger cut than the pimply faced dishwasher. In addition to hours worked we can introduce a new variable, an “x-factor” that is also applied to the tip distribution math, like maybe an “experience level”: leader, staff, trainee. Do you have a variable other than hours worked that you use to distribute your tip pools?

You in or out?

Some include management (salaried) staff in the distribution of tip pools and others exclude them. How about you?

Let us know how you do things and we might build you a special tool in BlackFox to help out. Either way, we will happily share what we find out about how everyone is handling this rapidly changing landscape.

I’m a solo entrepreneur (now with a small team). I write the software, do the marketing, mop the floors. I attend no meetings. I need approval from no one. The design work is done in my head or doodled on a scrap of paper and communicated to the team directly. We want to magnify the advantages of a small force on a larger more cumbersome opponent.

Creating shared knowledge and understanding within a group is challenging. Coordinating goals and objectives that are imperfectly understood between multiple groups of people adds another layer of complexity. Groups have different priorities and resources, their members have skills and knowledge that applies to a small portion of the whole and they lack the basic vocabulary required to understand those of the other groups. Creating a shared vision and getting all the members of a diverse and complicated organization moving in the same unified direction on any given subject is a monumental undertaking. The results are often less than ideal.

If you’ve ever worked for the government or a large corporation (both for me), you know half your working life is meetings. The main way large organizations tackle the inherent communication problem is to gather people together to talk. Significant effort is expended just on the systems used to book a space and time for the people to gather and on the technology they use to talk. Volumes have been written on the inefficiency and uselessness of business meetings, but I don’t have to convince you, you’ve been in those rooms, wondering, “Do I need to be here for this?”

A small team can all sit in a room around a white board and hash things out over lunch. They lack the communication problems inherent in large diverse groups. Small teams have meetings too, but all the decision makers and doers are present.

The old adage that two heads are better than one; it works for a small group, but 10+ heads do not produce 10x results, instead they find a median approach. As Paul Graham alluded to, large organizations create systems to eliminate risk, because they can’t afford risk, there’s too much at stake. But change is risky, innovation is risky.

A small team can make a decision to make a feature change on Monday, start it on Tuesday, and have it in front of customers by the end of the week. It’s a ruthlessly efficient process for developing and testing new ideas and the speed at which they can move helps manage the risk.

Working in a small team comes with a long list of challenges, but the agility with which you can move is unparalleled. Modern technology allows an individual with a modest set of skills to design, build, and deploy a software product to a global market in a matter of days for less than $100. People inventing things in their garage have unprecedented power to create new products.

Large companies entrenched in the market you are interested in look impressive and forbidding, as inevitable as a mountain. The truth is that they have never been more vulnerable. Working a few hours on evenings and weekends you can make as much progress as an international organization with a budget. It’s counter-intuitive, but true anyway. Don’t be afraid of the big guys, keep working on that side project.

Guerrilla Strategy and Tactics

guerrilla: noun - a member of a small independent group taking part in irregular fighting, typically against larger regular forces.

Guerrillas work at the edges, avoiding direct confrontations, moving into blue oceans. What aren’t your competitors doing? Can you eliminate competition by moving in a direction that they are not? What features do they all have that are expensive to build and maintain? Can you make a leaner product that eliminates their bloat? What you don’t build is as important as what you do.

The web allows you to reach a large number of people and win support and influence. You don’t need a large audience to test ideas; find a niche. Being successful does not require a large market segment when the whole world is your market, a tiny percentage is good enough to test, a couple points and you’re making a living.

Guerrillas use captured resources in their fight, utilizing the enemies own weapons against them. Steal your competitors designs! What are they doing well? Can you adopt winning ideas, functionality, or design elements? As artists, software developers, and guitarists all know; everything you make is derivative, building on what’s been done. Don’t be shy about borrowing good ideas.

Guerrillas use the environment to their best advantage. What can you farm out to 3rd parties? We are in a unique time. You have the same access to resources as your larger adversary. Amazon Web Services, for example, gives you access to the same incredibly powerful cloud server architecture and tools that the largest companies in the world use. Take advantage of the incredible infrastructure that you can tap into.

There has never been a better time to be a maker. You have immense power to create things and get them to market. Technology and innovation have provided you with levers big enough to move the world. Goliath is plodding and slow, so grab your sling shot and go take on that monster.

I’ve made my podcast debut! My good friend Ally Stone hosts a Discovering Hospitality podcast where she discusses the restaurant industry and its quirks and joys with her guest. Ally is genuine and heartfelt in all her endeavours and it’s always a pleasure to hang out with her.

I had no experience in hospitality, service, or the food and beverage industry before I opened a restaurant, so Ally asks the obvious question, “How did you end up owing restaurants?” We had a great chat about the challenges of dealing with people, my impressions of the industry as an “outsider”, my experience opening 2 restaurants and building the BlackFox software to run them, and my career as a circus performer. You should check it out.

We are please to announce our partnership with XTM Inc, a leader in mobile banking and payment solutions. BlackFox and XTM are teaming up to bring cash-less tip distribution to the BlackFox cash-out system.

Historically, restaurants dealt in a lot of cash, and Servers and Bartenders have traditionally ended their shifts with a pocket full of paper money. Cash has been losing favour as a payment method for decades and the restaurant industry has slowly been transformed by this changing reality. COVID has accelerated this evolution and virtually eliminated cash overnight.

The movement to a cash-less world has put restaurants in an awkward position. Servers and Bartenders are owed their tips at the end of a shift, but there is no longer cash coming in. The available solutions are not attractive; we can add tips to the companies payroll process, a route that adds complexity and invites a very unwelcome tax man, or the restaurant must routinely withdrawal thousands in cash from the bank to pay-out their staff.

The XTM TipsToday system provides a new and better alternative; a digital gratuity payout. They issue restaurant staff with a plastic card which the business can load funds onto. The staff member can use it as a credit or bank card. There is no cost to either the restaurant or staff for the service, XTM makes their money through fees that retailers already pay for credit card processing. It’s a simple, convenient, low cost solution to the problem of a cash-less world.

The BlackFox cash-out system already saves restaurant owners and managers time and energy by simplifying the daily cash-out process. BlackFox is well received by restaurant staff because it manages staff tips with accuracy and transparency. We are excited to work with XTM to provide this new cashless method to issue tips to restaurant staff, furthering our mission to make running a successful restaurant just a little bit easier.

I’m lazy and selfish. I don’t want to spend time doing things I don’t like. My mom likes to tell people that when I was a teenager I’d spend 10 minutes arguing with her about the best way to do a 5 minute task. Now I do that professionally; I fight to make your job easier.

I started my career being the best in the office at Excel, then to my delight I discovered databases, and eventually graduated to building web applications. My intention was always to solve my own problems, to make my day easier. I made good tools, useful for my job, so inevitably the rest of the office would adopt it. My career path is a trail of systems I built and left behind for those who followed.

Most systems are designed for the people at the top of an organization, they don’t help the people at the bottom, the ones doing all the work, in fact they add to their list of tasks required each day. The resulting system is hated by everyone working in the trenches because it doesn’t help them, it adds to their already busy day. The organization tries to implement a system that produces major friction from the people expected to use it everyday.

This resistance means that middle management must take on the role of enforcer. They spend their day pressuring subordinates into using this new burden, but the moment that pressure disappears, because middle managers have their own jobs to do, the system is ignored en masse by the workers, which means the reports and data senior management was looking for in the first place are late, incomplete, and inaccurate. Designing organization wide systems from the top down is a recipe that produces an expensive thing no one likes that solves the original problem poorly.

We design software from the bottom of an organization upwards. The primary objective is to help people do the work. What managers at the top of an organization want to know must be a result of the activities being done by the people working at the bottom. If you help people do the day to day work, you inevitably help the organization as a whole.

The added benefit of this philosophy is that the people at the bottom of an organizational pyramid cost less than those on top. Why pay a premium to have administrative or management staff enter data when minimum wage employees can do it as part of their job? Providing quality tools to staff can simplify a task, and that makes their job easier and prevents errors, which in turn reduces the effort and time requirements of managers, bookkeepers, and owners. The entire organization benefits by helping workers do their everyday jobs. That’s where problem solving needs to begin, at the bottom.

When you start a job, they give you a black box, metaphorically. Manuals, policies, procedures, spreadsheets, and templates. The box defines your job, which is to turn the crank on the box and produce reports, or sales, or widgets, or code, or... whatever.

On the second day at my new job I say, “Super excited to be here. I’ve been thinking about that black box. Have you ever tried it with rounded corners?”

Well, they haven’t, because the box works fine, great even. They’ve been using it for a decade, everyone is familiar with it. Why would you change the box?

That makes sense to me, and I like the job, so I keep turning the crank. But, as every day passes I become more confident, the box will work better with rounded corners. It starts as a curiosity and develops into an obsession, so I keep bringing it up. I can appreciate how that’s annoying.

I understand the argument for the status quo. Companies have momentum, there is value in consistency, changes cost time and money. I also believe that if your business isn’t evolving, it's dying. I’ve become sure that being a catalyst for change is where my value lies, and that I can’t help myself anyway, you can’t fight your nature.

There is a movement around starting a business designed to evolve. You begin with an idea to fly in the face of convention and build a grey rectangle, but you know going in that the plan will change, that the plan is to evolve the plan. You start with a grey rectangle, you build a prototype, put it in front of customers, test it, and you evolve it into a translucent green sphere. It’s a siren’s song luring many an inventive adventurer.

Entrepreneurship is a strange journey to volunteer for. Three of four startups end in failure. It’s a foolish thing to consider, yet it’s an alluring idea. You have to reach a point in your life where you would rather fail doing your own thing than succeed turning the crank on someone else’s black box.