Executive Summary: In this assignment, I'll be reviewing and analyzing the relation between performance and employees' role in Vama Restaurant. This paper will demonstrate my understanding of improving customers' satisfaction and small business planning in relation to practical strategy to improve current employees' performance to compete with complex business environment examples from Vama Restaurant. It presents a review of current Vama's changing customers' interest in new business environment as a part of business management and SWOT analysis, can be harnessed to the advantage of Vama. It also looks at the development of Vama's business planning process to meet the extensive and continuing changes that have taken place in the Restaurant environment. The notion of the role of the business planning of Vama is described and criticized with different strategic examples based on the given case study and various previous research findings of Food companies.
1.1 Meaning of small business: There is not any signal or simple definition of small business enterprise. The Bolton Report (1971) has suggested two definitions for small enterprise where he suggested a qualitative or economic approach that tried to capture the range and diversity of the smaller enterprise relative to the larger enterprise. The features of small enterprises are independent, managed in a personalised manner, and has relatively small share of the market (Anglund, 2000). In other words, smaller enterprises are often reliant upon a limited number of customers and have a limited product portfolio (Cosh, et.al, 2000); they tend to be exposed to greater levels of uncertainty in their markets.
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On the other hand, literature of small business has no single definition of small business up to now, however, one of the earliest attempts to provide a definition was provided by the Bolton Report (1971). Bolton has summarised two definitions for the small enterprise where he has described a qualitative or economic approach that tried to capture the range and diversity of the smaller enterprise relative to the larger enterprise. He has further described that small business has to meet the criteria of independency, managing in a personalised manner, and relatively small share of the market Manufacturing industry which has 200 employees or less, Construction industry which has 25 employees or less, and Mining and quarrying industry which has 25 employees or less are categorised as a small business. Furthermore, turnover of Retailing is £50,000 or less, Miscellaneous Services Turnover of £50,000 or less, Motor trades Turnover of £100,000 or less, Wholesale trades Turnover of £200,000 or less, Road transport five vehicles or fewer falls in small business category (The Bolton Report's (1971) quantitative definitions of smaller enterprises). Countries like USA and Canada have given the definition where a small business which employs fewer than 500 employees but Hong Kong has an alternative definition: SMEs are manufacturing enterprises with fewer than 100 employees or non-manufacturing with fewer than 50 employees (Carter, et.al, 2006).
Features of small business:
Research has summarised that management in small firms cannot be separated from the motivations and actions of the key actors. They are the essential component in understanding the fashioning of the relationships between ownership and decision making, managerial styles, organisational structures and cultures, and patterns of business development. The role and nature of ownership, the pattern of business management that emerges from small business and its connection with enterprise success and failure are now a common theme in small enterprise research activity (Goss, 1991; Goffee and Scase, 1995; Cosh and Hughes, 1998; Beaver and Jennings, 2000).
Portfolio of small business:
Operating Environment: Products and Services is the operating environment of SM where suppliers, delivery channels, contacts, arrangements, etc are its parts. Similarly, organizational culture is the second part of operating environment of SM where barriers, leadership, communication, cohesiveness etc are its parts. Furthermore; work force productivity is another part of operating environment where skills levels, diversity, contractor's aging work force etc are its parts. On the other hand, infrastructure is another aspect of operating environment where systems, technology, facilities etc are its parts. Finally, regulatory is another part of operating environment where product/service regulation, ISO quality standards safety, environment etc are its parts (Lecturer's note distributed at class room).
Business relationship: Organizational structure, customer relationship, value chain, and partner relationship are the aspects of business relationship of small business organizations where organizational structure indicates business unit, functions, board, and management layers. On the other hand, customer relationships cover organizational requirements, satisfaction, loyalty, and expectations. Similarly, value chain covers relationship between everyone in the value chain. Finally, partner relationships cover alliances, long -term suppliers, and customer partnership (Lecturer's note distributed at class room)
Business profile of small business:
Source: Paley, 2000
Always on Time
Marked to Standard
1.2 Introduction of performance: Research has summarised that the most important dependent variable in industrial and organizational psychology is job performance. Employee training and job redesigning are the main applications of psychology where the focus is almost always on improving job performance (Borman, 2004). Borman and Motowidlo (1993) have identified two broad classes of employee behaviour which are task performance and contextual performance. Recently, several researchers have defined counterproductive performance as voluntary behaviour which harms the well-being of organization and adaptive performance that is the proficiency with which an employee alters his/ her behaviour to meet the demands of the environment, an event, or a new situation (Borman et al., 1991).
Chosen organization: The chosen organization is Vama Restaurant Chelsea, London. It is an Indian Food Restaurant where verities of Indian foods are freshly cooked and served to customers.
Vama, an Indian restaurant was opened in Chelsea 20 years ago which is known as Vama Restaurant now and is a regular favourite of London's top chefs and restaurant critics. With increasing demands for home delivery and catering services of London, it was opened a long time ago. All of the best restaurant's qualities have simply been transferred to Vama where the restaurant provides the finest quality food for home delivery or special events. Today the restaurant is proud to boast its distinctive restaurants, popular delivery kitchens and its unique catering and events division (The bombaybicycleclub.co.uk).
1.3 Examining the Business area of Vama
SWOT analysis of Vama Restaurant:
Excellent Strong Brand name
Strong visionary leadership
Policy of complementary Popadam and Chutney to the customers
Large and expanding scope
Capacity to open new branches where required
Strong organic growth
Online ordering system
Visionary team of board of Directors
Verities of Quality food
Excellent customer services
On time delivery in the doorstep and serve at restaurant
Bad reputation for poor treatment of employees
Restaurant is far from main highways
Deducting labour hour to reduce labour cost
Lack of counselling with employees and management
Cooked food freezing food for a long time
Dependency on regular customers
Expensive food comparing to others Indian restaurant
Poor packing system
No consistency in quantity of the foods
Only evening opening hours i.e., no flexible hours for customers.
By increasing demand of delivery and catering services, the company can maximize its sales and revenues establishing new branches
New on-line booking system is available
Menu is designed to swot the test European plate
Indian cuisine has became popular with customers
Different international games are held in London so the company can cell more food while games are conducted.
Planning to introduce sport bar concept
Due to government's environment financial rules, restaurants may have to pay high taxes/costs for their west disposal
New branches of restaurants and take away may have an adverse financial impact
Health and safety threat by the government
Similar type of business is growing rapidly around the country
Threat of labour union (Nanni et al., 1992)
1.4 The role of existing measures in developing and implementing performance measurement systems: Research has concluded that performance measures provide a mechanism for relating product or process improvement policies developed by senior management to action at a local organisational level. The subject has been comprehensively surveyed (Ghalayini and Noble, 1996; White, 1996; Neely, et. al, (1995). Research has further summarised that encouraging the achievement of goals, performance measurements should be congruent with company strategy (Nanni et al., 1992). Financial measures are focused on the past (McNair et al., 1990). Often they are fragmented with cost, quality and output being treated separately .Local optimisation, individual responsibility and individual incentives do not encourage organisational (double-loop) learning. Survival in the longer term depends on customer service measured by factors such as quality, cycle time, employee skills, and productivity (Vokurka and Flieder, 1995; Bond, 1999). Previous research based on traditional view performance measures has argued that performance measures are used in the first two stages to monitor business performance and diagnose the cause of a problem (Bond, 1999).
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2.1 Methods of improving customer service in Vama: Following seven steps to satisfy its customers.
Customer Service Vision: The first step in creating customer service strategy is communicating the customer service vision to employees. Employees need to understand what the vision and goal for customer service is and understand their responsibility to help achieve that vision where vision covers a simply a written document that describes where an organization is going and what it will look like when it gets there. It is the description of what the company hopes to achieve and what it is striving for. This is what gives an organization its direction.
Assessment of Customer Needs: Organizations can't meet the needs of their customers without a good understanding of what the customer needs and expectations are. An assessment is done by soliciting customer feedback through customer focus groups, satisfaction surveys, or customer comment cards, and developing a comprehensive plan to meet and exceed the customer needs. The first step in any customer improvement initiative is to talk to the customers to find out their perception of the services being provided and what their needs and expectations are. Organizations fail because they thought they knew what the customer wanted and put together products and programs that they thought the customer would value, only to find out it was not what the customer wanted. Time and money are wasted on developing products and services that do not meet customer expectations. The trick is to find out what it is the customer wants and put together plans to meet those needs. Keep in mind, that customer needs and expectations are a moving target. What a customer wants today will be very different from what the customer wants a year or five years down the road. As things change expectations and needs change also.
To hiring the Right Employees: Hiring the right employees is another step of an overall strategy for strong customer service. Screening employees and ensuring that they process the disposition and skill set to help support a strong customer service environment is important. Skills can be taught but attitude and personality cannot. It's a fact of life that not everyone should interact with customers.
Customer Service goals: Once customer needs and expectations are identified and customer satisfaction is measured, it is time to create goals for achieving customer satisfaction. Employees need to understand what the target is so they can help the organization reach their corporate objectives.
Training: Good customer service skills are innate with some people but we all can benefit from practical teaching on the organization's approach to customer service. Much of the training should be practical teaching for how the organization would like the employee to behave in every situation. How to respond to customer complaints, how to be responsive to customers, how to meet customer needs, being empowered to perform service recovery, how to answer the phone and customer service standards are all pieces to a customer service training curriculum.
Accountability: Employees need to be held accountable for achieving customer satisfaction goals. This is part of a comprehensive performance management system and should be culturally expected. Employees should have a good understanding of how their service to the customer affects the overall organization's performance.
Reward and Recognition: There should be a well thought out system for acknowledging and rewarding employees for good customer service. Employees need positive reinforcement when they demonstrate the desired behaviors of a strong customer service culture. Furthermore, having a strong vision and strategy for customer service is a critical component to the success of any organization. Organizations need to identify who their customers are, what they want and develop strategies to achieve those customer requirements. A strong customer service strategy is what separates the successful organizations from the rest (Batt, 1999).
2.2 Overcoming Weakness
Variety of menus offered based on seasons, trends and customer preferences.
Exceeding customers' expectations by offering them a higher quality of food for a competitive price
Finances: customer base increases they will be better able to lower business supply costs by buying more in bulk through food service distributors.
Marketing: getting business name out to the public, primarily through an intensive marketing campaign driven by its customers with conventional marketing tactics (Carter, et.al, 2006).
2.3 New opportunities and expansion areas
This business is located in south west London area. According to its goal it can open a new branch in other areas of London like near to Holland Park or Shepherd's bush.
According to Ansoff matrix Vama markets their existing product range in a new market. This means that the product remains the same, but it is marketed to a new audience. Like Vama operating their business in south west London. But they can open more branches in different areas. Like, they can open one new branch in Holland Park. Those areas are one of the expensive areas in London. Most of the people who live in there are rich, busy and luxurious. They don't want to spend time at kitchen. They want ready fresh, quality food. So, business range will be bigger and better.
3.1 BUSINESS OBJECTIVE
To exceed customers' expectations for food service and food service products and increase the number of clients served by 25% per year through Superior service.
Business goal is to be a self-sustaining corporate enterprise within 3 years from the company's inception to begin expanding its menu offerings within 3 months and its location offerings within 4 years
3.2 Effectiveness of the business
The plan of catering and home delivery is effective for the business. But in some factor it is not very effective for the business. They plan to spend more money on employee. So, labour cost will be high and sales per employee figure will be low. Their budget in marketing is not enough. Their only plan is deliver leaflet to every door of the local area. They can expand their business to other places and supply food for home delivery only. On the other hand, people who have children and busy, they want good and health food. Even people, who don't have child don't want to spend time in chicken. So the plan of opening a new branch with delivery service is good for the business.
3.3 Improvement of the business plan
Take skilful employee. They spend a lot of money on employee but not getting good feedback. They can plan fewer budgets and take skilful employee. So sales per employee figure will be bigger.
They can spend bit more on marketing for business expansion. Can bring some new idea of marketing. Like, website developing, free delivery, voucher distributing etc.
They can change their plan for making and or expanding their restaurants with new facilities. Then people will come and have food on the shop. Even if that is big enough like 100 or 150 sitting capacity then people could arrange some party in here. Then customer number will be increase and people will know about this business.
3.4 Meaning of action plan: The action plane identifies the specific steps that will be taken to achieve inactivates and strategic objectives where the rubber meets the road. Assign responsibility, detail all required steps, establish a time frame, define the specific actions, provide a brief status report on each step, and define the action plane are the characterizes of action plane( Handout distributed by course leader). In other words,a business action plan provides the business enterprise with a way to formally communicate passion to everyone in the world. It tells a story about everything you have accomplished to far and of where we are headed into the future. It puts all the ideas and strategies developed in the company product network into paragraph form that is easy to read and understand. It is exciting to seen everything in one place. In other words, it is called a business action plan because it reminds business men to keep going after we complete our business plan (Wolter, R, (2001), Kick start your dream business, Ten Speed Press).
Action plan of Vama to improve employees' performance to satisfy customers
1 Ensure that the authority is properly structured to operate performance management
Review existing performance management practices within the [authority] to establish what needs to be done to reach compliance with the Code.
End of August
Ensure that overall strategic responsibility for performance management is held at a senior level and that, if all information functions are not part of the same command, there are close working relationships between them
End of November
Appoint a suitably qualified person, answerable to the person appointed under task 1.2, to act as performance measurement manager and direct the rest of the action plan.
End of December
2 Formulate policy and (where necessary) reallocate resources
Analyse business activities in preparation for drafting a performance management strategy and policy statement
End of February
Prepare and issue performance management policy, with senior management endorsement
End of March
Allocate adequate resources (including staff) to support the performance management function
End of March
Undertake information survey
End of April
Prepare a detailed implementation plan for arrangements in line with the records management strategy and policy.
End of April
3 Establish detailed performance management procedures
Develop a file plan and registration arrangements
End of May
Develop arrangements for the retrieval and tracking of performance improvement
End of June
Develop adequate performance improvement measures and security procedures
End of June
Develop a performance management policy.
End of June
Develop performance tools and schedules
End of June
Develop performance improvement appraisal procedures
End of June
Establish knowledge transfer arrangements for performance improvement for permanent customers
End of June
Establish secure performance measurement tools for improving customers' satisfaction
End of June
Ensure the [authority's] business continuity plan makes provision for the protection of vital records
End of June
4 Provide training and information
Establish a competency framework to identify skills and knowledge required by performance management staff and establish professional development programme
End of July
Raise awareness of records management issues throughout the [authority]
End of July
Introduce a programme of performance management training for all staff.
End of July
Provide guidance and procedure notes for all staff
End of July
5 Monitoring and review
Establish arrangements for monitoring compliance with records management policy and supporting standards, policies, procedures and guidelines
End of July
Establish arrangements for the regular review of the performance management policy and procedures.
End of July
Electronic performance management system
Develop a detailed specification and strategy for the development/purchase and implementation of a performance measurement system and related technology to improve employees' performance
End of August
Source: Geens, and Klaus (Eds), 2010
4.1 Factors influencing the business
Political: - The huge amount of tax every year, employment laws like health and safety, government law highly influences the performance of the business.
Economical: - Inflation and interest rates, high economical growth affects the business as well.
Social: - Entrance of new community to the business and different types of people in the market is another social factor to influence the business environment.
Technological: - Vama should be keeping on mind the following technological aspects.
Website with more information about their food and company.
Online job recruitment system.
Baking payment system.
4.2 Change Vama can make and the impact
One change Vama can make is to arrange a home chef facility. They can make a team included chef and service people. Vama has some chef who goes to cook in home or in party. If they have a team of service people then they could attend in some event like wedding, seminar etc.
Need to take more employees. So, labour cost might be high.
Business will get a huge number of new customers.
More capital will be used in this budget. Capital must need to increase.
Expenditure amount will go high. Example: travel cost, maintenance cost etc.
Total turnover of year will increase.
It is flexible job. So flexible roistering can help to reduce staff absence.
Need to get more training for customer services.
More chance to get promotion in rank.
They will get more hour.
More chance to get bonus and tips for good service.
Team work skill will grow up to them.
Need to be fast and accurate. Communication skills must need increase (Carter, et.al, 2006).
4.3 Promoting performance through shared values in Vama (Strategy recommendation):
Research and development is described as technical investigation and creation of new areas of knowledge or actual products, including innovation in materials, systems, construction processes, and management techniques where related activities are as follows.
Identifies industry needs by brainstorming research and development planning processes to find starting points for planning federal and private R and D investments. The information technology roadmap addresses ways that computers, software, and communication can improve the speed, efficiency, and quality of the homebuilding process (National Research Council, 2002, Sarkar, 2007),
Many writers have stressed that a prerequisite for successful product development is the acceptance at all levels of an organization of the need for change (Maidique, and Zirger.1994) After almost product development activities are disruptive of on-going activities and are, therefore, likely to meet resistance within the mainstream organization. Researchers have reported that neither Research and Development nor Marketing can successfully follow an innovative program if the rest of the organization's work is concerned with cost minimization. Product managers, new product managers, technical champions, executive champions are the key individuals in product development of Vama (Maidique, 1980). The implication is that without their strong personal commitment and enthusiastic and sometimes bloody-minded support for an innovation, many new product developments will not be materialized in firms where the values for change are not fully shared. After all, for a business to rely on a few exceptional individuals to force change through a resisting organizational culture is a high-risk approach where much is left to chance and the personalities involved(Takeuchi, and Nonaka,1986).
It is difficult for analysts to tackle with issues that deal with the more indigestible aspects of an organization like culture and atmosphere. However, it is clear that it is precisely these factors that distinguish successful innovator firms from the less successful. As Booz, Allen and Hamilton report successful innovators have an operating philosophy that incorporates a commitment to growth through new product development. They point out that the work of new product task groups and individuals can be nullified if other areas of an organization do not accept the validity of their work (Fitzgerald, and Peppard, 1997),
Inculcating an acceptance of change within an organization is a long and complex process and is likely to vary according to the organization's history, existing beliefs and management background. Many studies have shown that an innovating culture is fostered by an openness and interchange between different units and functions operating at all levels of the organization (Tushman, and Nadler, 1986). Such interchange is promoted by a number of different policies and operating norms, including staff training in the main functions (Takeuchi, and Nonaka, 1986) and cross-functional job design and rotation. Experience in different functions fosters creativity by inculcating multiple perspectives in the approach to work and facilitates effective cooperation in managing innovation where different functions and personalities have to be brought together (Crawford, 1983). Highly innovative organizations display diverse and informal communication networks both within their internal and external environments (Gardiner, and Rothwell, 1985) that bring a wider understanding of the changing market and industrial scene. The innovating culture of the organization can be supported by tangible symbols like mission statements (Crawford, 1983) and the elevation of new product development as a central tenet of corporate strategy. Similarly, Souder (1981) argues that entrepreneurial behaviour can be encouraged by appropriate tangible rewards for change agents within an organization.