Deaths Present Transition Challenge for In-N-Out : Management: Crash that killed two executives came at a strategic time in the company’s history.
The Wednesday airplane crash death of In-N-Out Burgers Inc. President Rich Snyder presents the family-owned fast-food chain with a leadership challenge and transition questions at a strategic time in the company’s 45-year history.
In-N-Out is in the final stages of transferring its headquarters from Baldwin Park to Irvine, a transition scheduled for completion in February. Now, however, the more difficult transition involves unexpected changes in management and control.
Snyder, 41, was one of five people killed Wednesday in the Santa Ana crash of a private jet. Also among the fatalities was Phil West, executive vice president for administration at In-N-Out.
The company said a senior management team is running the 93-store chain, but it would not divulge their names. Snyder’s brother Guy, who is company vice president, was not available for comment.
The restaurant chain’s ability to rebound “depends on what contingency planning they’ve made,” said Ron Paul, president of Technomic Inc., a Chicago-based food industry consulting firm.
A source familiar with the company said In-N-Out has a succession plan now being put into play.
Leadership succession is important in the restaurant industry “because it’s such a people-intense business,” Paul said. “One of the single most important elements at a restaurant chain is the leader. . . . That’s because there are more employees per dollar of sale in this business than any other industry.”
In-N-Out has about 35,000 employees--most of them at the chain’s 89 stores in Southern California. It also has four stores in Las Vegas. The chain had only 18 outlets when Snyder took over the privately owned company in 1976, the year his father, company founder Harry Snyder, died of cancer.
Leon Danco, director of the Cleveland-based Center for Family Business, expressed doubts that the transition will be trouble-free.
“You almost never see a succession plan left by a business owner in his 40s. I doubt that there is a detailed plan,” Danco said. “If they have such a plan, they would be amazing and fortunate.”
Even if a succession plan is in place, employees face a rough period of adjustment, said Diana Ho, a vice president with ManagementSystems, a Westwood-based consulting firm that specializes in such planning.
“It can be absolutely devastating to have the rug pulled out from under people like this,” Ho said. “Yes, there’s the future of the firm to consider, but there are also the personal repercussions.”
“People are definitely upset,” said an employee who provides restaurant location information to customers. “It’s a sad day.”
Unlike many other fast-food chains, In-N-Out has a reputation for paying its employees well. Snyder said the company paid more to attract higher-quality employees.
In-N-Out “is a well-run and strong competitor in the L.A. market,” said Huntington Beach-based restaurant industry consultant Robert L. Sandelman. “It’s really a tragedy, but I’m sure the company will survive.”
“Rich is the cream of the crop,” said Carl’s Jr. founder Carl N. Karcher, a longtime acquaintance of the Snyder family. “A lot of people in this business are jealous of what that company has done. He’ll be missed by many, many people.”
