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From its all-American menu, to its cheery waitstaff, to its walls decorated with local memorabilia, an Applebee's Neighborhood Grill & Bar looks about as radical as a barbecued-chicken sandwich. But that just proves the old proverb: Looks can be deceiving.

We're all familiar with the rules for success in Silicon Valley, Seattle, and other outposts of the dotcom revolution: If you want to win big, you have to think differently. But where is it written that only Web startups can play by new rules? According to Applebee's, the answer is "nowhere." The restaurant chain plays by its own rules, applying cutting-edge ideas to an old-school industry.

Consider its formula for growth -- which it calls "conscious cannibalization." Rather than carefully space out its restaurants so that the sales of one don't eat into the sales of another, Applebee's floods a territory with stores in order to gain brand recognition and market dominance. In the Kansas City area (where Applebee's is headquartered), for example, the company has 23 restaurants; Chili's, its biggest competitor in terms of market presence, has just 4 units. For a long time, most people viewed this strategy as a kind of heresy. The company had a difficult time convincing Wall Street that it made sense to violate the first commandment of retail: Thou shalt grow same-store sales. But, heresy or no, the cannibalization strategy paid off in a big way. "We came out of nowhere as a dominant player in the industry," says Lloyd Hill, 56, president and CEO.

He's not exaggerating. Back in 1988, when franchisees Abe Gustin and John Hamra bought the chain from W.R. Grace & Co., Applebee's consisted of 54 stores. Now the company has nearly 1,200 restaurants worldwide. In 1999 alone, more than 240 million visitors passed through the doors of an Applebee's, pushing systemwide revenues for that year over the $2 billion mark.

The Applebee's strategy has challenged conventional wisdom in more ways than one. For example, while most chains were building bigger and bigger restaurants to handle ever-growing crowds, Applebee's designed a smaller space for its restaurants, one that was cheaper and faster to build -- and easier to fill on slow days. The basic impulse behind Applebee's: Faster is better. Get to a neighborhood before the competition does. And keep things moving by providing customers with a convenient experience.

To be sure, there's more to providing great service than just speed (even at a fast-food restaurant). When you arrive at Applebee's, a host or hostess opens the front door and greets you with a smile. Pennants and jerseys from local high schools decorate the walls. Managers introduce themselves. If your date hasn't yet arrived, you're offered a seat at the bar -- a central feature of every restaurant. "Our restaurants are about more than food," says Hill. "They're about inclusiveness, value, comfort, trust, and relationships."

Of course, genuinely friendly service requires a genuinely enthusiastic staff. Job applicants take a written test that measures their skills and personality, and, if they get the job, they start getting feedback as soon as they begin working. "Imagine a 20-year-old kid who's never gotten developmental feedback at work before," says Lou Kaucic, who is known as the company's "chief people officer." "That kid will welcome feedback and think, 'Wow, Applebee's really cares about me. Maybe this job actually has more to offer than just six bucks an
hour.'"