How Peggy Cherng used her analytical know-how to help build a restaurant empire
From the Spring 2023 issue of the Oregon Stater magazine
By Kevin Miller, ’78
The three years Peggy Cherng, ’71, spent in Corvallis powering through a four-year program in applied mathematics are a bit of a blur. A rainy, green blur.
“Mostly I remember rain, green and studying. It was raining a lot in Oregon. And Oregon was very green. And I believe one time I got poison oak,” said Cherng, the co-CEO of Panda Express. The company operates more than 2,300 restaurants and brings in $3 billion in annual sales. “But it is important to me that you know that I am grateful for the education I got at Oregon State.
“I did have fun sometimes. But I was working on my studies.”
Cherng has been twice honored as an alumna — in 2000 as an Alumni Fellow of the College of Science and in 2012 by being invited to give the College of Business Dean’s Distinguished Lecture.
Born Peggy Tsiang in Burma (now Myanmar), she moved with her family to China as a child. They eventually settled in Hong Kong. She did well in school, especially in math, and was eager to go to college.
“Most of the people in Hong Kong get their higher education overseas,” she said.
She ended up enrolling at tiny Baker University in Kansas in 1967. It didn’t take long for her and fellow Chinese student Andrew Cherng to notice one another.
The two became friends and fell in love. They planned to finish their undergraduate work as quickly as possible so they could go to graduate school together and get married. In the meantime, she decided to transfer to Oregon State for her bachelor’s degree in math.
Why?
“I didn’t have any friends there, so that wasn’t why,” she said. “It was a scholarship. I just went.”
At Oregon State, she loaded up on challenging classes. And for the next three years, the couple maintained their Kansas-to-Oregon relationship in an era with no Facetime, no email and no free calling plans.
“I don’t think we could afford to talk much,” she said. “At that time a long- distance call was quite expensive.”
Once she got her OSU degree, Peggy and Andrew reunited at the University of Missouri, where he earned a master’s degree in applied mathematics in 1972 before moving to the Los Angeles area to help his cousin run a Chinese restaurant. In 1973 Andrew and his father, a chef, opened a full-service Chinese restaurant of their own, Panda Inn, in Pasadena.
Peggy, meanwhile, quickly finished a master’s degree in computer science at University of Missouri and stayed on to earn a doctorate in electrical engineering in late 1974. She was a rising star, specializing in complex pattern recognition and predictive analytics programming. Her projects included making CAT scans more useful and developing complex battle simulators for the Navy.
The Cherngs married in 1975 and soon started a family, which grew to include three daughters — Andrea, Nicole and Michelle. While Peggy did cutting-edge programming and engineering for McDonnell Douglas and other companies, Andrew and his father worked against fierce competition to make Panda Inn the best Chinese restaurant in the area. Though weekdays saw her doing demanding work in the defense industry, Peggy worked at the restaurant on weekends.
“I was there in a limited capacity at first,” she said, laughing at the memory. “I could only do hosting, and I was not a good hostess. Not very efficient. I couldn’t make cocktail drinks.”
By 1982, Panda Inn had a strong enough local following that the Cherngs decided to launch a fast-food spinoff, Panda Express, in a local mall the next year. Cherng greets an associate in Tampa, Florida. Today her company is the largest family- owned and operated Asian restaurant chain in the U.S., with more than 2,300 restaurants, 47,000 employees and $3 billion in sales. (Photo courtesy of Panda Restaurant Group.)
Peggy left her engineering career to handle the business and personnel aspects of the company, with Andrew focusing on growth and strategy.
Peggy is credited with creating one of the first purpose-built point-of-sale systems in the fast-food industry, as well as with many continuing innovations in personnel recruiting, training and motivation, including offering profit-sharing to the restaurant’s employees and promoting from within as much as possible.
In 1987, Panda’s chef, Andrew Kao, invented an orange chicken dish, and its popularity helped fuel rapid growth for the company. (The company sells a whopping 110 million pounds of orange chicken each year.)
It’s still Panda’s signature item, and among the places where it is consistently ordered is a Panda Express in the Memorial Union Commons at Oregon State.
What is Peggy’s favorite?
“Well,” she said, “I eat light. Some of the things I like to eat are tofu and eggplant, which are not exactly embraced by everybody who eats at Panda.”
What about orange chicken? She smiled.
“Of course. I do eat orange chicken because it’s our signature dish.”
Really? Like one bite per meal?
“No,” she said, laughing. “Two bites!”
The Cherngs continue to work as co-CEOs and remain active in the business in their mid-70s. Asked how they’ve maintained a successful marriage and a successful business together for so many years, Peggy said it hasn’t always been easy.
“We experience the same challenges as anybody else. You have to learn how to leverage each other’s strengths,” she said.
Part of what held them together during the early days, she said, was their common awareness that they were onto something new and different.
“No one else had a Chinese fast-food restaurant chain,” she said. “So it was all new. We were learning how to do it.”
When she’s not working, her favorite activity is to spend time with her family, especially her five (soon to be six) grandchildren. But work remains central.
Why not retire and kick back? She seems puzzled by the question because she continues to find joy in her job.
“Every single new step the company takes brings new things we must learn: more structures, more challenges, more organization to develop, something new to implement.”
For example, she’s working with others on the Panda team to use data analytics to help improve service and give local Panda managers clearer information on how they might support excellence among the associates (Panda’s term for employees) who work for them.
The Panda organization and the Cherngs as a family are active philanthropists, both through major gifts and via their Panda Cares foundation, which offers help ranging from food donations to college scholarships.
“The mission of the Panda Cares foundation is to support health and education of underserved children,” Peggy said. “To really make a difference, you need a focus.”
Among the Cherngs’ many gifts are support for the Cherng Family West Tower at Huntington Hospital in Pasadena and for OSU’s work promoting healthy children and families.
In addition to the challenges faced across the restaurant industry during the COVID-19 pandemic, Panda Express managers and associates were also subjected to incidents of racism fueled by a rise in anti-Asian sentiment.
“You cannot control other people,” Peggy said. “So, we focus on how we position ourselves. We are productive citizens in the communities we serve. You need a positive approach to hatred.”
No alumni magazine profile of a successful graduate would be complete without advice for those beginning their careers.
“I always say at the start that you have to believe in yourself,” Cherng said. “Also, you need to be curious, because only with curiosity can you learn and elevate and be better.”
She added: “And I believe engineering training and math training help the mind to think, especially when we face something uncertain and unknown to us.”
As for her own continuing education, it seems some friends have been taking her to school as she masters a new pastime.
“Recently I’m learning how to play mahjong,” she said. “But I’m a beginner, and sometimes as a beginner you have to pay what I call tuition. My biggest win is maybe $20, but my biggest loss is $40.”
Probably she can afford it, right?
“Yes,” she said, and then laughed. “I can.”