Eric Goldstein: Big Apple Operations

At a Glance

Accomplishments

ERIC GOLDSTEIN has transformed the NEW YORK CITY DEPARTMENT OF EDUCATION by:

As Frank Sinatra famously sang about New York City, “If I can make it there, I’m gonna make it anywhere.” That certainly rings true for Eric Goldstein, chief executive of The Office of School Support Services for the New York City Department of Education. The department serves 860,000 meals a day at 1,709 schools. “It’s hard to wrap your mind around that,” Goldstein admits. And if running foodservice for the nation’s largest school district wasn’t enough, Goldstein also is in charge of transportation and high school sports.

Building a team: Goldstein was hired in 2004 as a deputy overseeing food, transportation and high school sports. He was promoted to chief executive in 2007. Before joining NYC schools, Goldstein had no food experience. He had worked in England for different companies that focused on publishing and private equity, among other professions. “I have a very disjointed career,” Goldstein says. “Food found me. I’m not one of those people who said, ‘I want to be in the food business.’ I love to eat but food was more of a hobby. I came to this job more from a business and operational background. I earned my Ph.D. in food on the job.”

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Because of Goldstein’s business background, he saw that the department could look at its financial side in a different light. “School food is this quasi-corporate entity. Even though we are in the Department of Education, we’ve got revenue, expenses and a product,” he says. “Typically government looks at revenue and expenses separately. We said, ‘I’ve got private sector experience and a lot of other people have private sector experience so let’s start looking at revenue and expense together through a retail lens.’ We put the right management team in place and brought in some outside talent.

“I think we’re structured well,” Goldstein adds. “We have a great team of people who are smart and dedicated. We have a real wonderful chili, if you look at us in a food term.”

One of Goldstein’s major initiatives when he took over as chief executive was to hire people who didn’t necessarily have a foodservice background but who had business expertise. Goldstein hired one deputy who was a high-ranking officer in the Marines to work on the department’s logistical side. Goldstein says this “enables us to really focus and think about how we address our business through a retail lens.”

In addition to hiring diverse talent, Goldstein reorganized the department’s management structure. The department was divided into four categories: field operations, compli-
ance, food and food support and services. Each of New York City’s five boroughs has its own regional director. Following the reorganization, Goldstein says communication improved because a process was put in place for the flow of information.

Numbers crunching: After the people were in place, Goldstein focused on developing metrics. The original plan was for each cafeteria to run its own profit and loss statement. “One problem we had was that because of our systems, our data is about three months slow,” Goldstein says. “And I realized our people didn’t know how to handle a P&L or read a P&L. It was a totally ineffectual tool. So I said, ‘What’s a really good tool that we can nucleate our thinking around?’ The answer was cost per meal.”

Now each school computes its cost per meal, based on food cost only. Managers can then use that data to determine how their schools rank when compared with similar schools.

“Say there is an elementary school in this type of neighborhood and my cost per meal is 97 cents and I see that another school is $1.16,” Goldstein explains. “Now I can ask the question why. Should it be $1.16 because it’s a production site for another school and that makes sense, or no, it turns out they are ordering incorrectly. It enabled those kinds of conversations to take place. We empower people to say now I own the operation, here’s the proof of my ownership, I can look at my cost per meal and I can measure it against my colleagues and I can reward success.”

Stephen O’Brien, director of food and food support, says that this data-driven approach has been a welcome change. O’Brien has worked for the department for 20 years.

“I would describe Eric as being intelligent, innovative and a data-driven leader,” O’Brien says. “Eric really demands that we come to the table with that quantitative aspect. One way that he’s helped us to change is that by being more quantitative and looking at things from a more data-driven perspective, it gives the organization a lot of validity and strength when we take a position because if you have the data to back it up there is less noise, which allows us to stay laser focused on what it is we’re trying to achieve. It also allowed us to focus in on areas where we could improve.”

Increasing participation: Two of those areas that the data showed needed improvement were breakfast and the summer meals program. “One thing we saw in our numbers was that while we were doing really well in lunch—we had two out of three kids eating lunch with us—we realized we needed to promote breakfast,” Goldstein says.

For Goldstein, breakfast in the classroom was the best way to increase participation. “Unlike a private organization and other cities, New York City doesn’t want to mandate,” he says. “The city isn’t going to say, ‘everyone is going to do breakfast in the classroom,’ so we had to sell the program to various principals.”

To sell the program, an employee was designated as the “trainer” for principals to teach them about the program’s benefits. Another innovative way Goldstein sold the program was setting up booths at the principals’ union meetings.

Since starting the push two years ago, 330 schools have implemented breakfast in the classroom. Another marketing push was sending a postcard to 800,000 families in the city to tout the benefits of the breakfast program, which is free to every child in the district.

Another area Goldstein has tried innovative solutions to increase participation was in the summer feeding program. Two years ago, Goldstein partnered with Share Our Strength, a national anti-hunger organization, and the Walmart Foundation to secure grants to send out food trucks to deliver meals to parks and other mobile summer feeding sites. Last year with two trucks, 65,000 summer meals were served.

After increasing participation and the revamped fiscal perspective, Goldstein was able to reduce the tax levy contribution—or loss of money—from nearly $60 million in 2003 to $300,000 last year.

Menu changes: Like other districts, New York City is trying to increase the healthfulness of its menu items without scaring students away. “Our philosophy is slow, constant change,” Goldstein says. “When we changed the buns on our hamburgers we kept the top bun white and made the bottom bun wheat. The kids didn’t notice.”

The department also has reformulated its milk, using sucrose instead of high fructose corn syrup, and slowly integrated whole-grain pasta into its dishes. Another big push is salad bars, which have been added to about 800 schools. Because the department isn’t reimbursed for the salad bars, Goldstein says looking at the cost per meal metric became even more important.

“[By looking at the data] we have a way of measuring [the salad bars] and making the strategic decision that even though we are not going to get reimbursed, we are going to make salad bars work because it’s strategically important for us to make sure that kids get fresh vegetables and learn what fresh vegetables look like and taste like,” he adds.