Rivera, Richard Edwin

(1947-)
Red Lobster Restaurants

Overview

Richard Edwin Rivera, a tall and striking man known for his affable disposition, is president of the Red Lobster restaurant chain. As one of the highest–ranking minorities in the restaurant industry, he is viewed by many as a role model. His career has been characterized by achievement as well as a demonstrated concern for people, especially women and minorities. He has been honored for his efforts in encouraging women and minorities to develop in their job roles and to advance within an organization and in the industry.

Personal Life

Richard Rivera was born January 6, 1947. He earned his Bachelor of Arts degree from Washington & Lee University in Lexington, Virginia in 1968. Rivera married Leslie Suzanne Pliner on November 18, 1984.

In 1997 Rivera, who held various leadership positions in the restaurant industry for 25 years, took control of the Red Lobster chain, which is owned by Darden Restaurants. When he assumed this position he was determined to turn the moribund chain around by changing the restaurant image and expanding the demographics of its clientele. Rivera's alterations at Red Lobster amounted to a complete overhaul. He moved the once–hidden bar area to a prominent spot in the front of the restaurants, spiced up the food menu, changed such visual elements as the smallwares and employee uniforms, and implemented employee training programs that emphasized customer satisfaction. His efforts not only revitalized the chain but also improved the fortunes of its parent Darden Restaurants, owner of 1,173 full–service restaurants that included the Red Lobster, Olive Garden, Bahama Breeze, and Smokey Bones BBQ Sports Bar chains.

Career Details

Richard Rivera began his career in the industry working for the Steak and Ale Restaurants of America chain. He was employed by the Dallas–headquartered company from 1971 to 1980, starting as a management trainee and rising to the positions of executive vice president and director. From 1980 to 1982 he was president of the restaurant division for the El Chico Corp. For the next five years he served as chief operating officer for T.J. Applebee's and Taco Villa Mexican Restaurant. In 1987 Rivera joined TGI Friday's Inc., serving as executive vice president of operations until 1988 and as president and chief executive officer until 1994. From 1994 to 1997 he was president and chief executive officer of RARE Hospitality International, Inc. and the owner of Long Horn Steakhouse restaurants. He served as president and chief executive officer of Chart House Restaurants, Inc. from July until December 1997. Since 1997 he has been president of Red Lobster Restaurants, as well as director and executive vice president of Darden Restaurants. During his career he has also served as a Director of the National Restaurant Association. Before he entered the restaurant industry he worked as a credit analyst for National Bank Commerce in Dallas, Texas.

When Rivera joined Red Lobster, he regarded his mission as revitalizing the chain founded in 1968 in Lakeland, Florida. This included changing almost every element of the business involving customer contact, ranging from the bar to tableware and even to television advertising. His focus was nothing less than an entire facelift for the chain's well–established image. His redesign included a shift to highlight the bar, an area typically receiving as much attention, if not more, in other casual–dining restaurants. This change in particular represented a significant break from both tradition and the direction of the former owner, food giant General Mills, which seemingly hid the bar areas in order to de–emphasize beverage sales.

To achieve his aims Rivera engaged the services of industrial psychologist Tom DeCotiis, with whom Rivera had previously worked at TGI Friday's and Chart House Restaurants. Rivera had ambitious plans for Red Lobster and he believed that DeCotiis would be a good resource in helping him revitalize the stagnating chain. Utilizing his "visioneering" process, DeCotiis held extensive interviews with management and store–level employees, ultimately producing a document called The Compass, which detailed ways to improve the chain.

As a result, in 2000 Red Lobster remodeled 85 stores at a cost of $250,000 each. The impact of this effort was almost immediate as beverage sales and income increased. By the end of that year fiscal revenue for the "New Red" had increased to $2.08 billion.

In its earlier days Red Lobster had once enjoyed a reputation as a leading seafood restaurant. That image had diminished by the late 1990s however, as the chain was hurt by competition from other casual dining restaurants, some of which didn't even specialize in seafood. In response Red Lobster took to offering discounts, and became better known for its price–focused promotions than its menu. The chain's primary aim was to seat and serve as many people as possible. As a result of this approach the menu suffered, as preparation lacked imagination and all items began tasting the same. These were desperate, yet ineffective, measures meant to stem the tide of falling revenue.

When Rivera came on board he recognized the need to improve the hospitality element of the chain, which he felt was sadly lacking. Realizing that something would have to be done about the menu, he directed his chefs to spice up the food with stronger flavors and to make the entrée dishes more interesting. Specific changes included reducing the number of deep–fried items, adding more seafood pastas, and offering more fresh fish dishes. Part of the restaurant overhaul included the installation of a lobster tank as well as the inclusion of the giant lobster tail on the menu, which proved to be a popular item despite its price.

Rivera also wanted to change the "look" of the restaurant and this included alterations in table settings as well as the appearance of the staff. He replaced the plain white plates with colorful china. Employees were given a new dress code: out were the black–and–white uniforms and in were colorful print shirts, striped polo shirts, and khakis. "Before, everything was utilitarian," Rivera told Chain Leader. "Now, it's mostly about personality, though we still have a lot of work to do."

The employees themselves were retrained in a program that emphasized product knowledge and hospitality. As part of the training program employees were encouraged to take the initiative in creating "personality," providing energy and fun, and demonstrating a more thoughtful attitude toward the diner. Bartenders were taught how to perform tricks for the benefit of the bar customers and they were encouraged to push the appetizers. Rivera also created an employee–satisfaction survey, called "Crews Views" that was released every year. To explain the survey Rivera made videos in English and in Spanish. The bilingual approach was beneficial as Red Lobster recruited many of its summer interns from Puerto Rico and many employees in the Florida restaurants were Hispanic.

Rivera was experienced and savvy enough to realize that change wouldn't come easy. Such drastic measures put both himself and the entire restaurant chain at risk, since the faltering chain would have to go through a critical period before an upturn, if any, could be realized. Rivera knew that success could be achieved only by maintaining a fine balance. On the one hand, revitalization involved an influx of new customers, and a new clientele needed to be established and strengthened. At the same time he attempted not to alienate its established client–base, which might not be comfortable with the changes. The aim was to capitalize on the loyalty of the current customer base as well as the widespread recognition of the Red Lobster brand name, while not jeopardizing either with an overload of drastic changes implemented too quickly. Change could positively impact current customers. "But you need a keen understanding of how far they will let you go," explained marketing expert Karen Brennan in Chain Leader.

To walk the median, Rivera felt that he needed to emphasize the benefits of the casual dining experience. He wanted people to recognize that Red Lobster was more than just a seafood restaurant. Rather, it strove to be a place where anyone could come in and enjoy the camaraderie and social experience that the best casual bars provided. Still, Rivera needed for people to know that seafood would always be the predominate element.

Rivera didn't completely do away with the food price promotions but he reduced their number. In 1997 there were nine of these "price point" promotions; in 2000 there were only three. The menu was also improved and expanded. Its changes included the March–April "Lobster Fest" promotion that included such items as Tropical Lobster Chowder. The size of lobster tails offered were larger, as the standard one–and–a–quarter pound tail was supplanted by two–and three–pound lobsters on display in lobster tanks. Some restaurants included more non–batter–fried items, and others offered more fresh fish. Also, the menu expanded its selection of unique non–seafood items, such as a grilled chicken laced with chipotle–flavored barbecue sauce.

Chronology: Richard Edwin Rivera

1947: Born.

1968: Graduated from Washington & Lee University.

1971: Entered the restaurant business.

1980: Became president of restaurant division for the El Chico Corp.

1982: Named COO for T.J. Applebee's and Taco Villa Mexican Restaurant.

1987: Joined TGI Fridays, Inc.

1994: Named President and CEO of RARE Hospitality International, Inc.

1997: Became executive vice president of Darden Restaurants, Inc.

1997: Took over Red Lobster Restaurants chain.

2000: Received Trailblazer award from the Women's Foodservice Forum.

Social and Economic Impact

Richard Rivera's overhaul of Red Lobster had a significant and almost immediate impact. Among its 668 units, Red Lobster's average restaurant sales rose from $2.7 million in 1997 to $3.2 million in 2000. Same–store sales and customer volume boasted positive growth for 11 consecutive quarters. Rivera's efforts not only benefited Red Lobster but also Darden Restaurants. Representing 58 percent of its parent company's total units, the seafood chain propelled Darden's stock price to $26 per share, a 45 percent increase, by December 2000. Darden, like Red Lobster, experienced an upturn in its profitability after Rivera's improvements, posting 14 consecutive quarters of positive earnings. "I'm impressed with the turnaround at Red Lobster," said Mark Kalinowski, of Salomon Smith Barney, in Chain Leader. "The 'New Red' makeovers seem to have boosted sales."

Rivera's achievements in the industry have been noted as well as honored. He is known for actively recruiting and encouraging women and minorities. In 2000 the Women's Foodservice Forum (WFF) named Rivera as one of its recipients of the 2000 Trailblazer Award, which recognizes individuals with a record of achievement in propelling organizations forward and making a difference in the industry as a whole. Further, Rivera was singled out for demonstrating innovative approaches to business with diversity programs and for making a lasting contribution to furthering opportunities for women and minorities. Specifically the WFF cited Rivera for contributing to and promoting Darden Restaurants' diversity initiatives, such as the Minority Supplier Development Program. The organization also recognized him as being instrumental in repositioning Red Lobster's culture diversity, with respect and fairness as cornerstones. The WFF also pointed out that three of the six people on his executive team were women. Rivera, the WFF stated, embodied the Trailblazer spirit with his equitable approach to individuals without regard to their gender or race.

Sources of Information

Contact at: Red Lobster Restaurants
8815 Southern Breeze Dr.
Orlando, FL 32859–3330
URL: http://www.redlobster.com/

Bibliography

"Darden Restaurants, Inc." Hoover's Online, Inc., November 2001. Available at http://www.hoovers.com.

Farkas, David. "Lounge Act." Chain Leader, January 2001.

"The NRAEF Welcomes Eight New Members to Board of Trustees." National Restaurant Association Educational Foundation, 26 October 2000. Available at http://www.edfound.org.

"Richard Edwin Rivera." Biography Resource Center. Farmington Hills, MI: The Gale Group, January 2001.

"Women's Foodservice Forum Announces Emerging Leader and Trailblazer Award Recipients." Rich's—In the News, 9 March 2000. Available at http://www.richs.com.