Outback Steakhouse Employee Selection as Competitive Advantage
This paper examines how Outback Steakhouse leverages its employee selection process as a key source of competitive advantage. Drawing on organizational research, the paper discusses how the company's application, testing, and interview stages screen for cultural fit, resulting in consistently low turnover rates—approximately 2% annually—and uniform customer service standards across more than 1,100 global locations. The analysis also addresses the validity and cost-effectiveness of these selection methods, arguing that hiring practices aligned with organizational culture are central to Outback Steakhouse's sustained growth and stakeholder value since its founding in 1988.
- Introduction: Outback Steakhouse and Its Growth: Company background, scale, and staffing overview
- Employee Selection as a Source of Competitive Advantage: How hiring practices reduce turnover and strengthen strategy
- The Importance of Cultural Fit in Hiring: Cultural alignment ensures consistent service and low attrition
- The Selection Process: Applications, Testing, and Interviews: Three-stage screening process explained in detail
- Validity and Effectiveness of the Selection Process: Proven reliability, cost savings, and long-term cultural strength
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What makes this paper effective
- The paper uses specific, quantifiable evidence—such as the 2% annual turnover rate and 1,100 global locations—to ground its argument in concrete organizational reality rather than abstract theory.
- It follows a logical progression from the broad organizational context to specific selection mechanisms, making the argument easy to follow and cumulatively persuasive.
- Citations from multiple sources (Calvin, DeCoitis et al., and Gilley) are integrated throughout, demonstrating engagement with relevant scholarly and professional literature.
Key academic technique demonstrated
The paper consistently connects each selection practice (applications, testing, interviews) back to a central thesis: that structured hiring for cultural fit creates measurable competitive advantage. This technique—using each body paragraph to reinforce a single throughline with supporting evidence—is a strong model for applied business writing at the undergraduate level.
Structure breakdown
The paper opens with company background and establishes the central claim about employee selection. Subsequent sections address competitive advantage through low turnover, the role of cultural fit, the mechanics of the three-stage selection process, and finally the validity and cost-effectiveness of those methods. The conclusion synthesizes these points, affirming the reliability of the approach over time.
Introduction: Outback Steakhouse and Its Growth
When one thinks of popular chain restaurants, Outback Steakhouse often comes to mind. It is a company that has seen considerable success within its industry, most often because of its staffing selections and how they add value to the overall organization. The company has been in business since 1988 and continues to see positive growth. It is now a $3.25 billion company with over 65,000 employees working across an impressive 1,100 locations around the globe.
Employee Selection as a Source of Competitive Advantage
Employee selection has played a large part in the organization's overall success throughout its lifetime and continues to be a competitive advantage today. Such tremendous worldwide growth is an incredible opportunity; however, this expansion eventually put the company's values at risk in terms of potentially failing to deliver on service promises. This unfortunately happens to many companies as they continue to stretch their operations across greater geographic regions.
Outback Steakhouse took this potential disadvantage and turned it into an advantage over its competitors. Essentially, the company recognized that "employees are key to meeting the company's commitments to all its stakeholders" (DeCoitis et al., 2004, p. 23). Therefore, the selection process contributes directly to the organization's broader strategy of making Outback Steakhouse a rewarding place to work. By focusing on employee satisfaction, the company strengthens the organization as a whole. This results in greater employee loyalty and engagement, rooted in a genuine appreciation for the organizational culture.
There is an incredibly strong and prevalent culture within the organization, and the selection process used to attract the best employees reinforces that culture (DeCoitis et al., 2004). This creates a competitive advantage in that Outback Steakhouse is highly selective about who it hires and why. As a result, the organization focuses primarily on identifying candidates who will add genuine value to the company (Gilley, 2011). High turnover rates can impose severe costs on companies across multiple industries (Calvin, 2010). By minimizing unnecessary turnover, Outback gains a competitive edge. Its selection process helps ensure a lower turnover rate and, in turn, reduced costs relative to competitors. Research indicates that "Outback enjoys the lowest turnover rate in its industry, approximately 2% a year" (Calvin, 2010, p. 153). These elements illustrate how employee selection practices boost the organization's competitive advantage.
The Importance of Cultural Fit in Hiring
There is significant emphasis placed on the importance of fit within Outback Steakhouse. Ensuring that an applicant aligns with the established culture helps guarantee that all employees will actively pursue the organization's mission and values (Gilley, 2011). This means that despite operating across vast distances, the company can rely on its employees to deliver a consistent message and level of service to customers worldwide. According to the research, "the focus on fit between the applicant and the culture of the organization results in similar employee attitude and customer service across the Outback restaurants" (Calvin, 2010, p. 153). Additionally, prioritizing cultural fit helps keep overall employee turnover rates low (Gilley, 2011), which is an important component of maintaining the company's competitive advantage.
References
Calvin, J. (2010). Recruiting and selecting employees. Part III: Staffing. Workforce Education and Development. Web.
DeCoitis, T., Sullivan, C., Hyatt, D., & Avery, P. (2004). How Outback Steakhouse created a great place to work, have fun, and make money. Journal of Organizational Excellence, 23(4), 23–33.
Gilley, B. (2011). Outback Steakhouse. Strategic Human Management. Scribd. Web.
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