Crains New York - July 23, 2012 - (Page 26)

Keeping it in the family Continued from Page 25 SOURCE LUNCH: by Aaron Elstein RUSSELL REYNOLDS restaurant business until more recently—for their loyalty. Smith & Wollensky, located at Third Avenue and East 49th Street, is also a union shop, which means that its hourly workers have health insurance and the other benefits of a labor contract. Bill Granfield, president of Local 100, which represents the restaurant’s workers, said he is not aware of another eatery in the city with so many family members working together. “If you need six months off or one day to do something, we are very flexible with those kinds of things,” said Alan Stillman, a maverick restaurateur who founded Alan, “but I was pleased when he did.” Michael,who refers to his father as “boss,” has assumed much of Alan’s duties over the past nine years. “I’ve pulled back 100%,” said Alan, adding, “I don’t even have a title at the company.” The two are not afraid to contradict each other: “Alan’s title is founder,” insisted Michael, “and he is definitely involved.” chef for the past 25 years, brought three sons with him. “I had my first shave at Smith & Wollensky, brought my first girlfriend there and my prom date,” said Victor Chavez Jr., 29. Victor Jr., a saucier, refers to his father as “chef ” in the kitchen. He and his three brothers started working during the summers at Smith & Wollensky when they each turned 14 years old. Hugo, a waiter, and Alexis, a pantry man, still work there. Their father, who was born in Ecuador, oversees a staff of 25 dishwashers and 30 cooks, who crank out up to 800 dinners a night. He was part of the culinary team that opened Smith & Wollensky in 1977. As with all kitchens, tempers can rise. “We are lucky that we haven’t all killed each other yet,” said the father, laughing. “I go directly to the sous chef, my bulldog, if I see him [Victor Jr.] doing something I don’t like,” he adds. Alan Stillman paid for Victor, 59, to go to the Culinary Institute of America in midcareer. He also paid for Victor Jr. to get an education there, with each given time off to complete externships in Europe. “We have been good to each other,” said the father of his boss. Victor Jr. is keenly aware of the Victor Chavez and Victor Jr., Hugo and Alexis: Victor Chavez, executive ‘Sometimes we work next to each other. I don’t take that for granted’ T.G.I. Friday’s in 1965. “I think people stay with us for a long time because of our way of running the restaurant like a mom-and-pop business.” Like most steakhouses, however, the culture is distinctly masculine, which may explain why there is just one example of a mother and her child working at the 200-employee eatery—and it is a male cook who brought in his mother to the restaurant, where she launders the staff uniforms on a part-time basis. The Stillmans also own four other high-end restaurants and a nightclub in Manhattan under the umbrella of Fourth Wall Restaurants,of which Michael is president. But Smith & Wollensky is the heart of and the oldest business in the company, where, according to General Manager Tommy Hart, “we have 20 guys with one thing on their résumés—Smith & Wollensky—and I’m one of them.” Crain’s talked to several fathers and sons to find out why Smith & Wollensky has become such a family affair. Alan and Michael Stillman: LABOR STRIFE IN THE PAST THE STILLMANS’ relationships Michael Stillman grew up around the restaurant business, but unlike nearly all of the other sons of Smith & Wollensky, he didn’t spend his summers toiling in the kitchen or busing tables there. “I didn’t grow up working in my father’s restaurants,” said the Brown University graduate, who has a degree in art and AfricanAmerican political theory. He got his start in the industry working for one year for another famous restaurateur, Danny Meyer, and then “caught the restaurant bug,” he said. “I definitely didn’t encourage him to go into the business,” said 26 | Crain’s New York Business | July 23, 2012 with employees at some of their other restaurants have not always been harmonious. In 2005, they shelled out $164,000 to settle litigation at two of the eateries—Cité (now closed) and Park Avenue Café— at which a combined 23 workers claimed they were not paid overtime wages. The restaurants were among the first targets of a powerful worker advocacy group, Restaurant Opportunities Center of New York, which was just gearing up around that time. ROC NY staged public protests and loud rallies outside both restaurants, discouraging many potential diners from patronizing the eateries—and putting pressure on the Stillmans to settle. —LISA FICKENSCHER bond he and his father share, cooking in the same kitchen. “Sometimes he and I are working literally right next to each other,” he said. “I appreciate that. I don’t take that for granted.” Kevin Dillon and Kevin Jr.: Kevin Dillon still pinches himself when he sees his son, Kevin Jr., walking around the restaurant as manager of the Grill, a more casual eatery within the steakhouse. “I can’t believe that my son is working in a position that I started out in after I graduated from college,” said Mr. Dillon, chief operating officer of Fourth Wall Restaurants, which was formed after the New York restaurant broke off from the national Smith & Wollensky chain. The incredulous feeling is probably the same for some of the other employees at the Grill, who were hired by Mr. Dillon 20 years ago and attended his son’s christening. The Dillons are close, sharing a passion for food and cooking,living just 10 blocks from each other on the Upper East Side. But sometimes their shop talk at home is too much for the rest of the family. “Eventually my wife will put up her hand and say,‘That’s enough,’” said the elder Kevin. To distinguish between the two at work, the son, 23, is known as Junior, though he manages a staff of 15. “I try to show my dad that I can be just like him,” Junior said. Tommy Hart and Brian: Not every father-and-son team is a good fit at the restaurant, said Tommy Hart, 55, who has managed the chophouse since 1984. “We’ve had a few cases where the sons did not work out and were fired,” he noted. “But generally the fathers are all great workers, and you hope it carries down to the children.” The two Hart sons grew up at the restaurant,spending entire days watching the stewards stock the basement and the butcher carve up slabs of meat. The elder son, Thomas, 28, graduated from Cornell University’s School of Hotel Administration but decided that he was better suited for a career on Wall Street, while his younger brother, Brian, 24, was so eager to join Smith & Wollensky that he wanted to drop out of college to do so. His parents would have none of that. “I wasn’t allowed to work here unless I got my degree,” said Brian of his parents’ ultimatum. He’s now a bartender. Although his father is his boss, there is a layer of management between the two. “The staff knows who he is and they try not to treat him differently, which helps,” said Tommy. But the GM acknowledged the potential for conflict. “I don’t ever review my son, but I do review the guy who reviews him,” Tommy said. “Brian is told when he’s not doing his job, but that doesn’t happen often.” R A half-century of searching changed careers, I had lunch with my mentor, who introduced me to someone by saying: “Here’s Russell Reynolds, and he knows more about the search business than anyone else.” It made me think,if I know more than anyone else, why aren’t I working for myself? So I opened my own firm with $10,000, half of which I borrowed. In recent years, pay for the type of executives you place has soared while incomes for most people have been flat. What can be done about that? ussell Reynolds is the godfather of headhunters. For nearly five decades, corporations and governments have called him to find just the right person to help run a company, from JPMorgan Chase to Verizon to British Steel. Such is Mr. Reynolds’ influence in the search world that the eponymous firm he launched in 1969 still bears his name—even though he left it 19 years ago. The 80-year-old recruiter has just written a book called Heads: Business Lessons From an Executive Search Pioneer. What makes you good at search? I was raised around business leaders— my grandfather invented Philadelphia Cream Cheese and sold it to Kraft, Which banks? and my mother ran a business build- Citigroup to me is the single biggest ing houses when women simply did- embarrassment in corporate Amerin’t do that. I’m from Greenwich, ca. The stock price is ridiculous. Vikram Pandit is the wrong Conn., the 11th generation person for the CEO job. to live there, which means He’s a good man, but the my family literally cut down bank needs a world-class the trees, farmed the fields, leader, and he’s a trader. killed the Indians and all that. Growing up, I knew THE FOUR To be fair, Mr. Pandit took people like the Bush family SEASONS 99 E. 52nd St. over a tough situation and Citi and served on the finance 212-754-9494 at least is making money and executive committees www.fourseasons again. for George H.W. Bush restaurant.com The bank might be making when he was running for AMBIENCE: money,but shareholder valpresident. Ultimate powerue has been eviscerated over lunch scene How did you get into the the past five years. A corpostocked with the search business? ration’s first responsibility is rich and I was a banker at JPMorgan to its customers. Its second sometimesfamous who in the 1960s,and I had gotis to its shareholders, and if glance around to ten a reputation as being a the bank is now starting to measure up who’s people person and gregarimake money, shareholders eating with whom. ous. The bank wanted me are certainly not seeing it. WHAT THEY ATE: to move into the personnel Citigroup’s dividend rate is Spinach salad office, but I didn’t want four cents—a far cry from entrée that. At about the same Wells Fargo’s 88 cents or Soft-shell crab time, a friend explained to JPMorgan’s $1.20. I do not entrée me the recruiting business, see this downward spiral re2 herring appetizers how it was about making a versing anytime soon. 2 Diet Cokes, fee from connecting peolarge bottle of Who would you recruit to ple. My first thought was, sparkling water replace him? that’s immoral. But then I Tab: $188.42, My first call would go to understood it was an interincluding tip Michael Bloomberg. Give esting job,one that requires learning about lots of different busi- him 10% of the company’s stock to atnesses and the people in them. Smart tract him, because he’s the most competent businessman I can think of.Rex people do well at it. Tillerson of Exxon or Sam Palmisano What did people think of your career of IBM would also be good, and switch? maybe [former Wall Street senior exMy father said, “Has something gone ecutives] John Mack or John Whitewrong at JPMorgan?” He thought I’d head, if he were 30 years younger. I been fired because no one ever left the think Paul Volcker would be terrific, bank voluntarily. Six weeks after I but he’s also too old for the job. The basic answer to that question is we all need a better sense of perspective. I especially worry that the big banks are losing touch with, and the respect of, their clients and employees. WHERE THEY DINED INSIDE TIP Mr. Reynolds, a Four Seasons regular, prefers eating up front in the Grill Room. It’s the better place to be seen. http://www.fourseasonsrestaurant.com

Table of Contents for the Digital Edition of Crains New York - July 23, 2012

Crains New York - July 23, 2012
Contents
In the Boroughs
In the Markets
The Insider
Business People
Small Business
Opinion
From Around the City
Report: Real Estate
Real Estate Deals
For the Record
Classifieds
New York, New York
Source Lunch
Out and About

Crains New York - July 23, 2012