Since he joined Potbelly Sandwich Works as chief executive in 2008, Aylwin Lewis has steered the chain through a period of significant growth. Under his leadership, the Chicago-based sub shop has grown from about 200 units to nearly 350 today, and annual sales of $300 million. He also led the chain through a successful initial public offering in October 2013 that raised about $105 million.
Currently, Lewis, whose 30-year career also includes top executive positions at Yum! Brands Inc. and Sears Holdings Corp., is focused on growth and is pursuing a vision of Potbelly as a global brand that eventually could have upwards of 1,000 locations worldwide. The key to realizing that vision, he says, is people. Lewis credits much of the company’s success so far to its ability to “hire nice people,” actively support their development and include diverse points of view in decision-making.
Lewis recently spoke with Cheryl Bachelder, chief executive of Popeyes Louisiana Kitchen Inc., parent of the Popeyes Louisiana Kitchen chain, about simultaneously building a brand and its future leaders.
An excerpt from their conversation follows:
Cheryl Bachelder: Tell us what you’ve been focused on at Potbelly over the last several years that led to so much success.
Aylwin Lewis: I’d worked for big companies with a lot of resources, and the kind of brands that needed to be redefined or rescued, and that was always fun work. But I wanted something that was fresh, that was new ... so I could use my skills — build a team around it, define a culture, and help it grow from something small to something big. Potbelly was the perfect opportunity for me.
CB: I’ve heard that there’s something called the Potbelly Way. Is that your service proposition?
AL: We say we hire nice people and we teach them the Potbelly Way — essentially it’s just how to make the sandwiches. But we hire for personalities, we really hire for friendliness. The people are the crux of our differentiation.
Our values, our culture, and our leader’s intention is something we call the Potbelly Advantage. And it is three parts: our leader’s intention, which is our mission, our vision, and our passion; the second part, our values, how we lead and how we behave; and then the third part is our strategic framework.
CB: You recently just took the company public, which I know is a very exciting event. What insight would you share with us from going public?
AL: We’d been self-funding for the last four-and-a-half years, so our operations fund our growth, and the goal is to grow that business to generate the cash so we can open new shops. But we needed a new capital structure. So I think going public is the best way to get the right value for your performance. And as a private company, you just don’t get that. Obviously being in that private cocoon you’re not under public exposure quarterly, but I enjoy being public. I think it’s going to help provide access to capital in the future for us.
One of the things we promised was that we’re not going to let our stock price dictate fundamentally how we run the company. And that’s important to prove that every day from the top of the organization, and so far that’s what we’re trying to do. We recognize the responsibility we have to our shareholders, but we’re building a really long-term company here.
CB: What kind of growth runway do you see for Potbelly’s?
AL: We promised plus-10 percent in the unit growth each year, and we see that for the foreseeable future. We recently last quarter said we see at least a thousand units in North America. And we’re working actively to be a global brand. We’ll end the year at right about 350 [units], and we think we have a long way to go and a lot of white space, and that’s why we’re so bullish about what this brand can do.
Developing leaders
CB: One thing you and I have in common is we love the responsibility and the stewardship of leaders, of being leaders in our industry. I would love to hear you talk a little bit about what you enjoy in developing leaders in this industry.
AL: The beauty of this business … is it’s a people business. If you’re going to get past a certain level, it’s all about finding people, surrounding yourself with very smart people, and helping them be successful. My formula for the leadership thing is servant leadership — how can I help my folks be successful? And if the majority of my folks are successful, I’m going to be successful.
CB: One of the things I remember most about you, Aylwin, is how you managed your time. Tell me what your strategy is for productivity and how you convey that to your leaders at Potbelly.
AL: You want folks’ day-to-day activities to match the tactics and the strategies of their job. ... so strategy is not outside what you normally do. And so what we tried to do is put a strategic framework together that looks at what we have to be successful as a company. And it’s five strategic pillars, and everything we do falls underneath one of those pillars. If we have an activity or task that they’re outside one of those pillars, then why are you doing it?
Then let’s put [those goals and tasks] on a calendar, and let’s manage the calendar.
You can’t plan for every minute of every day because things unexpectedly are going to happen. You need time to think as a leader, you need time to study as a leader. I’m much more cognizant of that quiet time that you need as a leader to be prepared and to understand and to learn. And so we encourage folks to put that quiet time in their calendar now and not have activities minute to minute to minute.
CB: Another thing I deeply admired as I watched you work was your very intentional approach to lifting up people of diverse backgrounds. Can you tell me your philosophy about diversity and how you approach it in your company?
AL: [My job] is to make sure there are no artificial barriers that inhibit any person that’s capable. And we just don’t care. We don’t care about race, we don’t care about gender, we don’t care about sexual preference. We just care if you get our values. If you know how to make money, if you know how to treat our customers, we’re going to try to get you to the job that you’re most qualified to do.
[Your leadership team] needs to match the world. The days of one gender, one age group sitting around making all the decisions, thinking they’re going to fit your customers, [are over]. It’s good for your business but it’s [also] good for society.
It’s a way of life. It has to be. You can’t do tricks to get it done. People have to be qualified, they have to be ready, so we don’t have quotas or anything like that. But we’re actively looking to make sure there are no barriers.
Cheryl Bachelder has been CEO of Popeyes Louisiana Kitchen Inc., formerly known as AFC Enterprises Inc., since 2007, leading the Popeyes Louisiana Kitchen chicken chain. She was previously president and chief concept officer at KFC. She won a Golden Chain Award in 2012.
