The Computer in the Restaurant Case Analysis (In partial fulfillment of MIS Internal Assessment requirements) Aditya Das 2k91a05 PGDM (Gen. ) Trimester I Asia Pacific Institute of Management, New Delhi Case Analysis Traditionally, the business of a restaurant like Dailey’s involves a kitchen where the dishes are prepared and other supporting functions like washing the dishes is also carried out, an eating area where the attendants, i. e. the waiters and waitresses, attend to the customers.
The customers hail an attendant, place their orders with him or her, he/ she notes it down and then goes back to the kitchen to inform them about the order, the kitchen then checks if that item is available, if it is, the plates are loaded and sent to the respective table. Once the customer finishes his or her meal, they again ask for the check, the bill is prepared at the counter after tallying the order with the kitchen, printed or written, as may be the case.
It is then sent to the customer who pays it and leaves, usually leaving his copy of the bill behind (! ). At the end of the day, the manager then sums up the collections of the day, and calculates the profits etc. to help him draw up the accounts. He then analyzes this information to help him take relevant decisions This system suffers from a number of problems, which contribute in reducing the efficiency and effectiveness of the process. For example,
Since the waiter/ waitress notes down the order by hand, and this handwritten note is examined by the kitchen, there is always a chance of an order being misinterpreted because of the handwriting not being clear or legible. If the kitchen runs out of a food item, the attendant does not know about it, so he/ she takes an order and comes to the kitchen, gives the order to the staff as usual; only at the point where order preparation begins, do the staff realize that they can’t do it. This results in considerable wastage of time.
Since information is available to the management when all the sales information is logged in and has been adequately analyzed, which is usually a time consuming process, therefore management is never up to date about matters and hence cannot take highly effective decisions which are relevant to that particular moment in the restaurant’s life-cycle. Management is also never able to identify deficiencies in time, this causes a fair bit of damage to the restaurant until the problem has been identified and tackled.
In Dailey’s Restaurant, the installation of a minicomputer based information system has helped solve the above mentioned problems and improve the process efficiencies, thus positively affecting the bottom-line. It is important to note that Dailey’s waiters and waitresses were involved in the selection and design of this system, and all potential users were asked to give their ideas and an impression regarding the various systems available before any one was chosen.
Through this exercise, Dailey’s management ensured that there would be minimum resistance to the introduction of the system from the waiters and waitresses, who were most prone to mistrust of a new system, much in the way people are suspicious of a new boss, or even a new co-worker! They have introduced computers at several key points in the process, thus reducing the time lag and the chance of any mistake taking place to just about zero. Order taking, for example, has changed drastically. Waiters now, after taking the order, just feed it into an online terminal in the eating area.
The customer’s meal check is also automatically generated, thus eliminating the three copy guest check as well as any problems caused by the waiter’s handwriting. If the kitchen runs out of a food item, it is prominently displayed on the terminal; hence the waiter will be able to inform the unavailability to the customer, so that the order can be changed before it reaches the kitchen. This results in quicker, better service and thus, a more satisfied and less harried customer. Since the system provides real time data on the food items ordered, and breaks out percentages showing sales of items versus total sales.
This helps the management in taking effective decisions and incorporating innovation, not to mention assisting them in reining in costs by providing them with data on food costs incurred versus weekly sales. Overall, the analysis concludes that the introduction of the system was a positive development for Dailey’s, which changed fundamentally, its customer service processes and management decision making. Not to mention bringing about a drastic change in its quality of service. Questions and Answers Q. In managing the business of a restaurant, what are the decisions that need to made in the areas of: -strategic planning managerial control -operational control Ans. Fig. 3 levels of business activity (Classic management Triangle) In the restaurant, as in any business enterprise, there can be three levels of business activity, which were first described by the classic management triangle by Robert B. Anthony in 1965. The first level of operational control deals with processes performed to control the basic goods or services produced. In the restaurant, operational control will deal with decisions made in the area of order taking i. e. the interaction etiquette of attendants, preparation of customer orders and presenting the dish to the customer.
The next level, management control, includes the functions that facilitate the management of those processes delegated to the operational control level. The feedback from the production scheduling helps determine what orders to give. In the restaurant, managers will make decisions regarding what and how much of a particular food item is to be ordered, based upon the feedback from operations, similarly if the kitchen breaks down or a chair is broken, the manager will take a decision on replacing them or repairing them. Management control also includes disciplinary action on errant employees.
The top level on the triangle represents strategic planning processes – the processes which determine which products to produce in the first place. In the restaurant, under strategic planning, managers take decision regarding which items to place on the menu, or if they should open another branch of the eatery, or even if they should source from a particular supplier or not. Q. What information would you require from this system in order to aid making these decisions? Ans. The following information must be provided by the IS: Customer order information: what people usually order, what dishes are popular with certain kinds of consumers, etc.
Inventory information: what items are being consumed in providing customer service, in what proportion they are being consumed etc. Mathematical analyses: computation of sales volumes, comparison of periodical sales totals with food costs, percentage sales of each item versus total sales, comparison of cost of labor with total sales etc. Deficiencies: whenever a void is reported, it should be recorded with the system and the reason for the void, keyed in, should be made available by the IS whenever queried. Q. Compared to this system most restaurant information systems are relatively informal.
Explain the probable effects that making the system more formal will have on customers, waiters and management. Ans. Customers, although they will feel the difference, in terms of superior delivery times and possibly a reduced price as a result of the more formal system, may also feel ill at ease because they have come to the restaurant to enjoyed a meal in a relaxed and informal atmosphere, and are not comfortable in the formal air that the system creates. Waiters will undoubtedly benefit from the more efficient system as their workload will be reduced greatly.
They will also be less responsibility on their shoulders since their work will be confined to taking orders and delivering the food to the table, as a result they may be able to up their standards with regard to these activities. However, on the downside, they may feel that their abilities are not being adequately utilized; they may also miss the direct contact they had with their peers in the kitchen. Also, since theoretically this system is supposed to eliminate all errors, the pressure on them will increase. For the management, the formal system will be a win-win situation. It will be easier for them to keep a tab on the accounts.
They will have all the data that they need to make managerial decisions, at their fingertips. All customer data may also be available to them. Analyzing the data will be that much easier, hence strategic decisions will be easier to make, as well. The only drawback may be the complacency that the management might be tempted into, so in spite of the modern system in place, the management will do well to follow the old fashioned management norm of keeping one’s eyes and ears, open. ———————– Levels of Business Activity Operational Control Management Control Strategic Control