Nature Of Burgers Plc Business Commerce Essay

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"Organization is only as effective as its processes." Therefore the report focuses on carefully managing the processes to produce and distribute products and services allowing for the nature of Burgers Plc business. Fast food has become so ingrained in our culture that it's hard to imagine a world without pre-packaged burgers, ready meals in boxes, and mountains of left over packaging in the bin every week for the dustmen. Recycling thus should be encouraged, as nowadays it does seem to have just scratched the surface of the problem.


Impressive Burgers Plc is a fast take away food chain, produces seven set meal options in a range of sizes. The company has operations in several places and is considering a further expansion.

The paper is primarily devoted to the planning and management of the resource capabilities used by the firm for efficient production. The capabilities are comprised of the work force (e.g., skills), technology (e.g., information-based technology), and processes (e.g., supply chain, inventory-distribution system, quality control system, etc.) all of which represent a significant portion of a firm's total costs and controllable assets.

The current situation analysis helped understanding the operations and the process of delivering products to a customer. Along with this, the report identifies the advantages/disadvantages of the existing system. The paper is based on the comprehensive coverage of operations and thereby suggests recommendations that can improve the process of expansion.

Company Activities

Ability to satisfy todays and future demand is fundamental for a company. If the balance between capacity [2] and demand is right company can satisfy customers cost efficiently, if it is wrong - it will raise costs and fail.

Value chain is a cumulative work of the processes that aim to produce a product that will satisfy customers of a company. Each and every activity in a process should bring value, eliminate waste and unnecessary costs. Impressive Burger core processes are a chain of activities that deliver value to its external customers. Support processes provide fundamental resources and inputs to the core processes and are essential to the management of the business.

1.1 Core processes

1.1.1 Customer relationship

The company has been on the market for over ten years and has already an established customer base. Introduced greater variety of set meals and side dishes helped increasing the number of customers, mainly through attracting those seeking healthier options. However, a drastic point of sale service improvement is required, as company faced an increased number of customer complaints of unsatisfactory service and misplaced orders.

1.1.2 Order fulfilment

To satisfy its customers Impressive Burger Plc should concentrate on reducing serving time, as, due to the shortage of staff and technology, it grew from four to nine minutes, which is high for a fast food chain.

1.1.3 Supplier Relationship

Number of customers increased after extending the product spectrum, thus Impressive Burger needs to negotiate prices with suppliers bearing in mind the higher volume of the orders they place.

In general, due increased number of sales shipment of inventory may not be sufficient, on the other hand, unused stock could create wasteful resources, thus, bearing in mind expansion, on-time deliveries and short lead times of supplies are key points for Impressive Burger. Working effectively with suppliers is one of the ways to add a significant value to the services/products of the company.

1.2 Support processes

1.2.1 Recruitment

Since the introduced changes the number of employees was not altered, which increased an amount of workload per employee, putting an additional pressure on employees that negatively affects their performance.

1.2.2 Human resource support and development

The number of complains regarding employees' performance severely increased, arising from the same number of employees producing a greater level of output to meet the increased demand, which also demonstrates a lack of training.

Impressive Burger Plc does not assess the value employees provide to the company, nor mentions payment for the work. However, considering the increased daily work load, motivating employees could essentially improve their work.

1.2.3 Information system

Existing ways of processing orders starting from the point of placing an order by the customer should be closely looked at, due to high number of misplaced orders , suggesting that machinery (tills) were not programmed to facilitate the changes in the menu and unreliable machinery at assembly point above all.

Critically evaluating the existing business it became apparent that expansion of Impressive Burger operations is not a desirable tactic at present. The decision is based on the problems that company is facing at the moment: shortage of staff and machinery, untrained workforce, customer dissatisfaction to name but a few. However, after the established 10 year market presence a successful company operations growth is a logical and desired process.

2.0 Problems and possible solutions

Impressive Burger should eliminate physical constraints, which limit the performance and restrict the output at the maximum capacity rate, by improving quality, work of machinery, labour, and managerial in terms of mind-set that currently slows down work flow.

Machinery bottleneck - this resource hinders the ability to meet product mix and required raised demand. This should be used to maximize the throughput by good scheduling, task trained and efficient staff that are using high quality products to maximize the utilization of machinery.

Managers ought to concentrate their attempt on balancing the production flow through either process redesigning or process improvement to reduce response time on placed orders.

If neither option is proven to be helpful, simply because machines are utilized to the maximum, managers may look into possibility of purchasing additional machines or machines that can handle more capacity, although this will require financial resources.

Problems are divided into three main categories: staff, customer complains, and order deliveries, based on the fact that all of the problems faced by Impressive Burger arise from these particular issues. Staff: lack of workforce, their incompetence and leadership. Stock control: increased value of stock and significant increase in waste, deliveries, inventory holding.

Embracing two fundamentals of operations management, such as increasing quality and efficiency, is critical to a business success. It may bring tremendous improvements, including increased customer satisfaction and cost-savings.

2. 1 Workforce

2.1.1 Shortage of staff

Based on the business nature employees should be considered as company's most important asset, as customer satisfaction begins with the attitudes and abilities of employees. Committed and effective workers are the best route to success in the competitive fast food business. With additional new products on offer, there is, however, a shortage of staff to handle it. To be effective, Impressive Burger needs to acquire more employees.

Recruiting and training staff is expensive and businesses will have to look for ways to keep staff turnover to a minimum.

hire people who want to excel in delivering outstanding service and possess essential skills and behaviours for a position

advertising an open position a job description should outline typical duties and responsibilities and a person skills, competences and possible experience

introduce a probationary period, after which employee is rated on the performance and either retained or terminated from their employment

It should be taken into account that majority of staff that would be recruited would mainly be people aged 20 or under and the Impressive Burger is likely to be their first experience of employment. Managers should concentrate their attention on the interview process to recognize those potentially committed employees who will excel in delivering outstanding service.

2.1.2 Motivation

Through the process of correct recruitment and constant self-development through training the employees will be inherently self-motivating. Managers of Impressive Burger should therefore be responsible for maintaining this motivation by facilitating in five key areas:

Setting realistic targets.

Employee's personal achievements should be recognized.

Managers should keep in mind that any changes in a job specification may affect job interest, which is an important motivator.

Allowing more responsibility to an employee to show the potential to undertake a more senior role.

Giving special attention to increased employee participation through good job design can reduce the problems of stress and frustration amongst workforce.

2.1.3 Customer Service

Considering the problem of increased customer complains about unsatisfactory service - training will be required for new employees, as well as to make existing employees work of more efficient.

Company will be able to build lasting success if they concentrate on providing highest standards of quality, service and cleanliness delivered to customers in each restaurant. Training should be seen as particularly important within the operations of the company, allow employees to develop their full potential. The career development training program [3] for the crew and operations management could enable a 'first job' employee to be promoted through to a management position, thus boosting motivation of employees to perform better.

To achieve reliable customer service and to have a flexible workforce, it could be useful to train employees to perform many different tasks, either at their workstation or as they move to another workstation, however it requires greater skills, thus comes at a cost.

2.2 Customer complaints

Increased number of complaints due to incomplete/incorrect orders and increase in serving time are crucial issues. First of all, customers expect the orderly and quick service, they want quality that is appropriate to the price they are prepared to pay, thus changing incorrect orders will not only increase the serving time, but also could ruin the company's image, consequently Impressive Burger may be losing customers.

2.2.1 Quality

Generally quality will determine a firm's success in a number of ways, such as customer loyalty, strong brand reputation, fewer returns and replacement that will lead to reduced costs, attract and retain good staff.

The quality of the company's service is measured through different aspects, in the case of Impressive Burgers through level of product returns or customer complaints. Detailed analysis of the area could achieve the better customer satisfaction, thus increase loyalty and bringing overall success. Customer satisfaction is usually measured by a survey and customer loyalty is evident form repeated purchases.

2.2.2 Quality Control

Managers should consider checking the quality of complete products for faults, either through inspecting random product samples for each 100 to 200 batch personally or appointing a staff member. However, individual staff is not necessarily always confident bearing responsibility for the quality of their and other team member's work. Though, the evident advantage of this approach is that such inspections may reduce error orders reaching the end consumer.

2.2.3 Quality assurance

Empowering workers to make decisions is a strong motivator. As a result employee's interest and involvement in the job increases, so does quality of products they produce, helping the company gaining its marketing advantage that arises from a consistent quality level.

This approach aims to achieve quality by organizing every process to prevent mistakes, encourages for the job to be done right from the first time - costs are reduced due to lower wastage and no re-working of faulty products.

Any of the two approaches could be used; management of the particular restaurant should decide which approach suits their management style best and the staff employed. Both approaches are highly effective at preventing defective products from reaching the customer. It is important to keep the level of incomplete or incorrect orders low. With high level of mistakes the company's profitability will suffer.

2.2.4 Quality Benchmarking

Benchmarking is a general approach that Impressive Burger could use to decrease customers serving time. It is based on best practice in the industry that provides a useful quality improvement target for a business.

This involves Impressive Burger Plc to compare its service with another successful fast food chain in the UK and aim to equal the speed of delivering orders to customers for takeaway food.

In some cases, firm can use an internal benchmarking in which best practice may be set with reference to Impressive Burger restaurant at a different location.

2.3 Inventory Control

Impressive burger has a substantial increase in stock as well as dramatic increase in waste at each restaurant in their restaurant portfolio. One of the problems faced by Impressive Burger Plc is too much of buffer stock held, and at the same time overestimated level of demand.

Effective inventory management helps to reduce the cost of reordering and holding inventory, also without enough stock production and sales will grind, while overstocking might mean a lot of waste, resulting in profits decrease. The system of stock management should be in place to lower costs, improve competence and ensure production can meet fluctuations in customer demand. Stock control means that Impressive Burger should ensure that it has sufficient amount of high quality stock at any time. This will not only make the production more efficient, but recover customer satisfaction as the products will be available on demand at any time.

2.3.1 Stock holding cost

Despite the reported increase in demand, the financial report of Impressive Burger Plc showed disappointing figures. One reason is overstocking, as holding extra stock is costly - increased warehouse space, high insurance costs, high security to prevent theft, stock maybe damaged or become perish.

Simultaneously, company should keep in mind that having stock-outs could bring severe consequences in terms of loss of production and potential loss of sales/missed orders that could badly damage reputation of the business.

2.3.2 Waste

At the moment managers place their orders to suppliers according to generated till sales. Despite the fact, that sales increased, the waste has also risen dramatically; the reason being - a greater variety of set meals and side dishes that Impressive Burger receives.

Impressive burger needs to consider the following forms of waste:

Over-production: producing more than immediately required.

Waiting time: equipment and labour efficiency should be used to measure waiting time.

Process: (unnecessary processes exist due to poor work designs that could be eliminated, e.g. end products are only prepared on demand) there could be some processes that exist because of poor component design or poor maintenance and so could be eliminated (ja ne uverena, pravilno li ja ponjala processes, no ja by vykinula eto krasnym, a ostavila to, chto v skobkax).

Inventory: the target of Impressive Burger should be to eliminate inventories.

Motion: simplifying the work could greatly reduce the waste.

Defectives: quality waste is quite significant in company's operations and carries a lot of costs.

Increase in waste may be dealt through implementation of lean production system. Lean production focuses on cutting out waste, whilst ensuring quality. When this system is used, it can be applied to all aspects of the company, starting from design, through production and distribution. The success of this framework will ensure that costs are cut and business operates more efficiently. This approach aims to eliminate all activities that do not add value to the production process. Impressive Burger Plc needs to concentrate on cutting out stock holding cost, changing defective products and unnecessary actions of workforce around the work place.

3.0 Steps towards Improvement

The main goal of the company is to make their chain restaurants reputable in London, to provide customers value and good service, while making profit. With growth the business becomes fragmented and keeping it under control may become increasingly difficult, thus strategy should be implemented for improving short and long-term operations.

To operate at the company's full potential in the future, the following decisions should be made: strategic, tactical and operational. Strategic decisions are looking at a big picture of the business: typically future oriented. The next level should involve tactical decisions: establishing the key initiatives to achieve the overall strategy. These decisions are very important as they are the glue that creates a strong connection between the long-term objective of the company and its day-to-day activities. The final stage is to make operational decisions - determine how activities actually get done. Al process decisions are made at operational level. Managers would have to take real time decisions here, and be able to make quick adjustments to achieve the desired outcome.

3.1 Strategic decisions

Effective operations decisions follow from sound operations strategy, which should be built upon speed service, low prices, and big volumes.

Strategic planning of Impressive Burger Plc needs to emphasis:

improvement in quality

review of the aims and objectives

assessment of performance against objectives

delegation of duties and consistent tasks to staff

accountability of employees actions

reporting system ???

technological improvements

Company should design process capacity with effective constraint management - design lean process activities by eliminating activities that do not add value, while improving those that do.

3.2 Business Planning

As a prerequisite for improvement before devising approach, all operations of Impressive Burger need performance measurements.

A company's business plan needs to be reviewed to enable managers to identify the most important features of the future activity and therefore encourage efficiency. For further expansion, the business plan may be used by Impressive Burger Plc to raise necessary financing, for instance bank loan.

4.1 Key Performance Indicators

Once an organization has defined its goals, it needs a way to measure progress toward those goals. Key Performance Indicators are quantifiable measurements that reflect the critical success factors of an organization.

KPIs are used in many industries to monitor and improve efficiency. In fast-food industry companies set what needs to be accomplished to achieve their goals, and they identify a measure to make sure it happens. Impressive Burger may use KPIs to monitor every process - how long it takes you to receive the food, how long it takes to cook 100 burgers, etc.

4.2 Balance scorecards

The balanced scorecard is a strategic planning and management system that is used extensively in business to align business activities to the vision and strategy of the organization, improve internal/external communications, monitor performance against strategic goals.

This approach to strategic management provides a clear prescription as to what companies should measure in order to 'balance' the financial perspective. This approach may prove to be useful for Impressive Burger as it presents an overall picture of the organization's performance in a single report, thus is a comprehensive measure of performance that helps to take decisions in the interest of the whole company.

4.2 Benchmarking

It is a process of learning from others and will involve Impressive Burger to judge their own performance against the methods used by other fast food restaurants. This might help to generate ideas and set targets that could contribute to performance improvement of the company in the future. However, if this approach is adopted to be used successfully by Impressive Burger Plc it should be a continuous process of comparison and not a one off approach, but it should not be seen as a solution technique, rather as an ideas generator that can lead to solutions.

5.0 Supply Chain

Impressive Burger Plc cannot deliver the value sought by their customers without the suppliers. Therefore quality should be embraced by the whole supply chain: management of materials, information, technology and funds from the raw material supplier to the consumer. Supply chain is essential for the company to be able to generate revenue and relates to growth, efficiency and customer satisfaction.

5.1 Customer-supplier relationship

Choosing a reliable supplier should be the key for growing the operations and building reliable relationships. Impressive Burger might consider short listing its suppliers according to a reputation for quality and tangible symbols of quality, such as ISO 9001. Of those, who satisfy the basic criteria, price can be an important factor in final selection.

5.2 Just-in-Time

JIT might be the best option available for fast food industry, as production is hugely reliant on suppliers. Therefore, Impressive Burger has to secure the existence of a responsive and reliable supplier in place to support just in time operations, and deliver exactly the right stock to a precise location within a narrow time frame.

JIT, unlike presently employed delivery of inventory on a once every other week basis, means that stock meets specific orders, this would mean that little or no stock hold, thus a reduced storage space needed which will save rent and insurance cost for the company. Moreover, as stock is only obtained when it's needed, less working capital is tied up in stock, which will allow to free extra finances for further expansions of company's operations. The far most important for Impressive Burger advantage of JIT is that stock becoming out of date is unlikely.

While applying this method of inventory control, Impressive Burger Plc should realize, that there is a little room for mistake as minimal stock is kept for re-working faulty products, thus, a vast attention should go to re-train staff and control the quality.

JIT system can also be used to eliminate waste wherein Impressive Burger does not begin to cook or reheat and assemble the orders until a specific order is placed. There is a more sophisticated technology available that will enable a company to make food fast enough without keeping customer waiting. However, to serve customers quickly, the number of floor staff is ought to be increased. In short, company should be able to provide a customer with their order as fast as possible while having the finished product sitting in inventory for as short as possible.

5.3 Internet

Supply chain permeate the entire organization, there are no processes that are not affected in some way. Impressive Burger may take advantage through the use of the Internet to reengineer its information flow throughout the organization, especially order fulfilment and supplier relationship process. Moreover, though the use of technology in its supply chain, Impressive Burger will be able to track product movement daily.

Variety and freshness are paramount to fast-food industry in order to satisfy its customers. Impressive Burger should closely work with distributors to have ingredients for the menu delivered with flexibility and speed.

The short shelf life of food requires the shipment of inventory to be done urgently and with care, thus more frequent inventory driven from supplier to chain operators. Beyond this, fast-food restaurant are all about value - selling meals at the lowest cost possible, thus inventory carrying costs up and down the supply chain should be managed. Therefore, ideally, Impressive Burger instead of working with multiple distributors has to have one reliable supplier that could offer a greater control over inventory and shipment, preserving and growing brand loyalty, while strengthening business relationships.

In other words, Impressive Burger should promote a cooperative orientation supplier relation in which the buyer and seller are partners, each helping other as much as possible. Though this partnership, supplier gains economies of scale as order volumes increase, which lowers costs. A cooperative orientation will allow Impressive Burger Plc to have less complexity in managing its suppliers. There is however one disadvantage - sole sourcing; reducing the number of suppliers may increase the risk of an interruption in supply chain, and amplify any problems with the supplier that may crop up.

7.0 Planning and control

7.1 Kanban

This system could be used to control the level of inventory and stock replenishments, to signal information regarding the movement of products. The system can signal the authorization to move inventory or product from the supplying location to the consuming location - Impressive Burger restaurants. The benefits:

1. It puts limits on inventory build-up.

2. A Kanban acts as a limit - when it is full, no additional product can be made, or moved, into that location.

3. Less inventory means: less cash is tied up, less space required, less handling and damage, reduced amount of scrap or rework required when a defect is discovered.

7.2 Six Sigma

Six Sigma is becoming a proven approach for businesses to improve performance. It is based on collecting the operating data that can help improve processes by reducing their variability and eliminate defects from product and service. There are three ways of using Six Sigma. For Impressive Burger operations the most useful would be the following: Six Sigma as a target approach - to give everyone in the organization a target for the number of defects or errors that can creep into the operation. By reducing a number of defects employees would reduce the associated failure costs and encourage a satisfied and loyal customer base.

8.0 Customer Quality

To deliver quality to customers the fast food operations must adopt some form of systematic approach to identify and correct any errors that occur during production/service. The aim is to reduce the gap between the customer requirements and the actual performance of Impressive Burger operations.

8.1 Total Quality Management (TQM)

Applying TQM to Impressive Burger operations, company should set quality standards for the entire organization. The main feature of this approach is that it concentrates on the requirements of customers, thus all practices of the company should meet standards that are in the interest of a customer. Thus Impressive Burger has to be to keep the production/service errors to an absolute minimum.

The benefits of TQM:

Lower scrap costs

Improved reliability

Fewer after-sales problems

Improved competitive advantage

TQM emphasize people in the organization and their roles, through broadening their skills, encouraging creativity, training and empowerment, performance measurement and finding ways to improve it.

TQM - is a specific approach to quality assurance that aims to develop a quality culture throughout a company, promotes teamwork and participation, encouraging employees to do their work 'right first time', thus producing no defects. This system could work great alongside the JIT framework.

8.2 Kaizen

Impressive burger may implement continuous improvement policy that is known as Kaizen. Employees, with the help of managers will be able to constantly introduce small changes in a business in order to improve overall quality and efficiency, as employees are the best people to identify room for improvement, because they can see the process constantly in action. Firstly, however, managers should encourage the culture that rewards employee's initiatives and their contribution.

8.3 Quality standards

There is general agreement about the nature of the standards that any organization should be aiming for, nowadays widely used International standards - ISO 9000 - to ensure consistency with international business practices. Rather than using different standards for different processes within the business, this approach helps to focus on outputs from any operation's process. A quality system requires documentation of all procedures throughout the company, therefore when employee consistently follow the procedure that have been laid down, then the scope of error is reduced to a minimum and the quality of the product and service of Impressive Burger Plc will be maintained.


Quality management is customer focused

Quality performance is measured

Quality management is improvement driven

High commitment from top management to continuous improvement of management systems

9.0 Environmental Sustainability

Businesses should always follow laws to what must be recycled. There have been a new standard ISO 14000 introduced in the recent years that guides environmental management system. The role of this concept has some parallels with quality management.

Impressive Burger Plc needs to be aware of the impact of its activities on the environment, as many of them are concerned with waste. Environmental responsibilities are connected with operations managers' day-to-day decisions, which should be set up to be cost effective and sustainable.

Impressive Burger need to concentrate on:

supply chains' employment conditions

use of harmful materials or high energy consuming processes in the production

disposal of waste products

relationships with local communities where activities take place

welfare of staff, visitors, volunteers and other stakeholders

The company principles should be built around "reduce, reuse, and recycle principles" in managing its environmental impact, which may also make sound economic sense.

Impressive Burger needs to set KPIs for each of its restaurants that incorporate an achievable but challenging performance target and will act as a guide to its overall operational sustainability. Performance against the target will be reported annually, the KPIs reviewed and new targets set.

9.1 Waste management

Waste management is one of the most important environmental issues for food industry operation due to:

shortage of land where waste can be buried

effect on human health due to pollution

excess packaging

transportation of waste to large distances adding to carbon emission and further pollution

To minimize waste:

invest in waste minimizing technology (grinders)

compost as much waste as possible

recycling glass, paper, plastic can reduce waste by 35%

educate the staff, suppliers and customers so that also minimize waste

9.2 Energy and water consumption

Ensuring that energy and water is used efficiently in all processes may visibly reduce costs effectively increasing profits.

Ways to reduce consumption are:

using energy efficient equipment and light bulbs

recycling of grey water

adjusting taps and toilet water tanks

minimizing water leakages

training staff to switch off lights when not needed and use water responsibly

10.0 Conclusion

Company needs to realize that the success of the restaurants and the company as a whole is achieved through the workforce it employs, thus Impressive Burger should aim to recruit the best people, and provide an ongoing training relevant to their position and offer promotion when they are ready for next career step.

Working effectively with suppliers may add significant value to the product of the company.