Applying Operations Management Concepts and Techniques: Zoes Kitchen - Case Study Example

APPLYING OPERATIONS MANAGEMENT CONCEPTS AND TECHNIQUES ID Contents 0Introduction 3 2.0The Issues affecting Zoe’s Kitchen 3 2.1Market Requirements 3 2.2Customer Services 4 2.3Capacity Management 4 2.4Focus and Scope of Business 5 2.5Facility Location 5 2.6Process Layouts 6 2.7Materials Management 6 2.8Supplier Selection/Relationships 6 3.0Analysis 7 3.1Market Requirements 7 3.2Customer Services 8 3.3Capacity Management 8 3.4Focus and Scope of Business 8 3.5Facility Location 9 3.6Process Layouts 9 3.7Materials Management 9 3.8Supplier Selection/Relationships 10 4.0Key Issues 10 5.0Outline Solutions 11 6.0Conclusion 12 7.0Bibliography 14 Applying operations management concepts and techniques 1.0 Introduction Zoe’s Kitchen has been preforming relatively well in the catering industry. However, in the recent past the management has seen the need to improve in some of their operations. The need for improvement is necessitated by the fact that the industry is becoming highly competitive with a number of new entrants coming up with ways of winning customers. There is also the issue of growth of the market, which will require the business to increase their capacity so that they can be able to serve more customers and in a shorter duration. Given the anticipated growth in demand when the city of Manchester’s hosts series of “City of Culture” events, it will be prudent to say that this will be the most appropriate time for Zoe’s Kitchen to make these improvements. This report aims at using applying operations management concepts and techniques to come up with ways through which the operations of Zoe’s Kitchen can be improved. 2.0 The Issues affecting Zoe’s Kitchen 2.1 Market Requirements Operation management can have effect on all the five stakeholders in this business. The five categories of stakeholders are: customers, shareholders, employees, suppliers, and the society. The five objectives that should always be looked into when it comes to operation improvement are: quality, dependability, speed, cost, and flexibility. Quality happens to be the most important of these objectives. The quality of food can be affected both internally and externally (Parker 2012, p. 175). Basically quality in this case can be said to be the ability of food to reach or even surpass the expectations of the customers in terms of the level of satisfaction. At Zoe’s Kitchen it can be said that the quality of the food is assured by the fact that the business have two specialized chefs. The amount of time that the Zoe’s Kitchen takes to respond to the request of a customer is also of high importance because it in most case contributes to the level of satisfaction of customers. Most customers would like to book their lunch meal an get them in the shortest time possible. Dependability might at sometimes be highly affected by the speed, but has various other factors that can be said to influence (Marchioni 2010, p. 211). Dependability comes from the situation where customers have faith that if they make orders at Zoe’s Kitchen they will get their food delivered in good time, and in good condition. As far a flexibility is concerned it can be said that Zoe’s Kitchen does not have much varieties especially in their deliver-only menu. As for cost, many customers will always go for the seller who enables them to save some penny. 2.2 Customer Services The style of deliveryservice that a business accords its customer usually determines whether or not the business will be able to keep its customers. Services that customers are given should always be about them and not about the business or its profitability. The customers should be given the impression that their views, needs, and complaints are valued (Bhattacharyya 2011, p. 112).As for Zoe’s case there is little that the company has done with regard to putting in place a system through which they can onvolve customers in increasing all the aspects of their operations. 2.3 Capacity Management Many business organizations are usually not able to perform according to their market capability because of their lack of capacity to do so(Grummit& Van Bon 2009, p. 229). This means that sometimes these business organization have to settle for less activities though there are more activities that they can get involved in. sometimes some of these capacities needs long term increment because there is an increase in demand that is perceived to be a long term one (Dugmore& Lacy 2005, p. 167). In Zoe’s case capacity will be determined by the storage space and the number of employees that the they have in case they intend at attending to extra customers. 2.4 Focus and Scope of Business Various business organizations usually tend to focus on specific market segments. This is important because it makes it easier for them to produce in according to the wants and needs of the specific target market (Bourne 2002, p. 207). Not having a specific target can be complicated because a business is always expected to come up with a marketing strategy that will be appealing to all the market segments. As much as having no targeted segment leaves a business organization with a larger pool of possible customer, operation in such an environment is usually very hard (Johnson, Newell &Vergin 1972, p. 211).Zoe’s Kitchen does not focus on any market segments. This is one of the reasons why some of the latest market entrants such as “urLunch” are doning better in the market because of specializations. 2.5 Facility Location When deciding on location one of the most important things that should never be taken for granted is the location of a business’ targeted market(Shiring 2014, p. 109). Locating a business far from those people who are most likely to consume the product or services produced by an organization means that they will have to incur extra transportation cost which will either limit their profits or limit their ability to engage in price battles(Mahadevan 2010, p. 152).Zoe’s Kitchen is located in within the city of Manchester. This is an emplication that they might have a chance of winning more customers especially the working population who come to the city every day. 2.6 Process Layouts An operation does not only involve production. After products are produced they need to be stored so that they can be safe for the period before they are taken to their consumers. Production and storage should be harmonious(Panneerselvam 2012, p. 132). The operation should such that whenever any production takes place there is a mechanism that gets them to a proper storage place. As for the work layout it can be said that the most notable thing is that the space at Zoe’s is organized in such a way that the chefs have suffiecinet space to do their work. The layout is such that foods gets from the storage area to the kitchen, then to the package area, then ends up in the fridges. 2.7 Materials Management Planning is very important in making sure that a business organization minimizes their expenditure. The “Just in Time” (JIT) strategy is commonly used to ensure that a company increases its efficiency through minimizing wastage (Lai & Cheng 2009, p. 187). This is a strategy that enables business organizations to acquire only the materials that they need.Zoe’s makes use of the JIT to make sure that they do not buy more food such that they get spoilt while in store. They also do so in order to cope with the limited storage space that they have. 2.8 Supplier Selection/Relationships The suppliers of a business organization form an important part of their operations. This is because their suppliers are the ones who avail the materials that they use for production(Bode 2003, p. 112. The kind of relationship that a business has with their suppliers is very important. However, a manager should make sure that they maintain close ties with the suppliers who are most beneficial to their productivity. In the case of Zoe’s Kitchen they use both suppliers who make deliveries and those who do not. Some of their supplies have long-term contracts while other do not. Read the instructions given in revision. 3.0 Analysis 3.1 Market Requirements In the case of Zoe’s Kitchen, it can be seen that the quality of the food that they make has never been a question. In fact, they made sure that the quality of the food that they produce is of high quality by hiring two highly qualified Chefs. One thing that is questionable about the operations of Zoe’s Kitchen is their speed. Given the staff size it can be seen that for deliver only orders customers have to at least make their bookings by 10 am for lunchtime deliveries.this can be as a result of the business’ capacity in terms of personnel and assets. .This explains the reasons as too why people have to make their bookings at least three hours before the time that they want the delivery to be made. Zoe’s Kitchen can be said to be flexible because of their ability to serve both delivery only customers and the “deliver-and-serve” customers. However, this kind of flexibility gives them a disadvantage in competing with some of their specialized competitors such as “urLunch”. This is because “ufocusrLuch” is able to focus on offering lunch time deliveries to workers during lunch time hour. Such specializations help in enhancing speed and quality of food. 3.2 Customer Services Of the 12 employees that work at Zoe’s Kitchen, none has been mentioned to be handling customer service. The main assumption in this case will be that either Zoe or Steve is in charge of customer service. The business seems not to have a well-establishedmechanism through which they can have effective communication with their customers apart from making orders. 3.3 Capacity Management Zoe’s Kitchen has limited capacity in terms of storage space for the products that they have made as they await delivery.As seen sometimes they have to do with fewer orders because they usually don’t have the stock to handle increased orders. The refrigeration space that they have does not allow them to take larger quantities of material to be ready for the possibility of there being an increase in demand. As far as “deliver-only” services are concerned there are always very few changes throughout the years. However, as for “deliver-and-serve” services there is always some seasons in the year that experience more demand for catering services. 3.4 Focus and Scope of Business Zoe’s Kitchen does not target any market segment. They have some kind of flexibility that makes them able to attend to nearly all the segments in the market. This is evident in the manner in which they have been able to offer both “deliver-only” and “deliver-and-serve” services during their period of existence. However, when it comes to the “deliver-only” services they focus on, six sandwich selections a portion of cake, three salad selections, and a cereal bar. This makes their “deliver-only” services attractive for midday meals especially for people with tight daytime schedule (Scanlon 2013, p. 145). As for the “deliver-and-serve” services there is a little bit more flexibility with the business being able to handle different types of events. 3.5 Facility Location The location of the business should be assumed that the business is located in Manchester city with most of their customers being people who work in the city. This assumption is made on the basis on the number of employees make deliveries and the nature of meal delivery services. 3.6 Process Layouts The process of the operation begins with orders being made. The physical layout resembles a "process/functional layout"; there are five key workspace areas: oven area for hot food; cold area reserved for the preparation of salad; preparation of hors doeuvres, order of products / the assembling and dispatch area, and the area for preparing sandwich. At the assembly point, the deliveries-only are parked into boxes and dispatched while the deliver-and-serve meals are served onto their serving platters. The business has three refrigerators for food products and on for non-perishable products. The company outsources for deserts.Deliver only orders are scheduled daily while the deliver-and-serve orders are scheduled every Monday. This means that deliver-and serve orders have to wait till evry Monday before they are acted upon. 3.7 Materials Management Zoe’s outsource desserts from suppliers, some of whom make deliveries while others do not.Thebusiness is sometimes forced to order a certain quantity because of two reasons, namely: lack of storage space and lack of assurance on demand. 3.8 Supplier Selection/Relationships Given the fact that Zoe’s Kitchen has been in the business for a relatively long time, they have been able to develop good working relationships with their suppliers. This specificallyapplies to those suppliers that they have been working with for that long. The good relationships gives assurance that the business will be able to get steasy supplies because this has been the case. 4.0 Key Issues The main issues here include the business’ capacity. Zoe’s Kitchen have a low capacity with consideration to the potential customers that they are expected to be handling. The three refrigerators that they have for keeping food products seem not to be enough because sometimes they happen to attend to fewer orders due to the fact that they cannot deal with more orders. Another thing that the business should work on is their speed. New market entrants with specialties have proved to be much faster because they have specialization. This makes it easier for them to make the meals faster that Zoe’s Kitchen is able to. Now that Zoe’s Kitchen serves a variety with both deliver-only and deliver-and-serve-services, it is clearly evident that sometimes customers’ orders take longer.This is especially true given the fact that customer is expected to book their lunch time meals latest by 10 am. This show the extent to which they need to work on their speed. Another thing that is noted about their operations is the fact that they use a single area for assembling both types of orders. This would bring up the question on exactly who does the assembling of both. Looking at the size of staff, someone will not fail to n notice that the number of staff member might be a contributor to the speed in which the business organization operates(Kachru 2007, p. 211). The number of staff does not only contribute to the low speed by can also hinder their dependability. Manchester is a big city and it is clear that four delivery guys cannot be able to effectively do the delivery all over the city. Given that the lunchtimebreak is usually limited to many workers in the city; it is of high importance to make sure that the meals get to them in good time. It is also notable that Zoe’s Kitchen’s pricing is not competitive. This is seen through the extent to which “urLunch” has been able to aggressively grab a percentage of their market share because of their lower prices. There has also been a call by some of the customers for a little bit more flexibility. As far as the “deliver-only” services are concerned, the business has not been able to have a more flexible menu. Their menu mainly consists of six sandwich selections, three salad selections, and a portion of cake and/or cereal bar. 5.0 Outline Solutions There are a number of things that Zoe’s Kitchen can do to improve their operations. For instance, it would be prudent if they could increase their storage capacity. Increasing their storage capacity will imply that they are able to cater for more customers in a single day. This might also help in acquiring materials at affordable prices since buying in greater quantity usually give a buyer a bigger bargaining power (Mukherjee &Kachwala 2009, p.223). However, they should still be keen on the amount of material, especially the perishable ones that they take lest they will have some of them go to waste. Another thing that they might consider doing is introducing a number of other meals in their “deliver-only” menu this will help them in giving their customer a variety to choose from, given the fact that customers have been asking for a little bit more flexibility of late. This will help them in winning customers who do not buy from them because of the fact that their menu lacks flexibility (BPMN 2010, Mendling, Weidlich&Weske 2010, p. 173). This addition should come after a research on the additions that would be attractive to the city population. Zoe’s Kitchen should also consider increasing the number of permanent employees that they have. Speed of high essence in the catering industry. One of the ways through which the business can make sure that they reduce their delivery tine, is by increasing the number of people working on the orders. This will mean that they will even have the ability to handle sudden increase in demand. They will also reduce the period whichcustomers have to wait before their meals are delivered. More delivery guys will also mean that they will able to convince their customers on their dependability because deliveries will be made in time regardless of the actual location of the customer within the city (Grover & Markus 2008, p. 178). The company should seek the opinion of their customers. They should create a channel of communication including a website where customers are welcomed to give their opinion on what they think the company should improve in. this will not only make customers feel that their views mater, but will also help the business in becoming the caterer that their customers will always prefer. This can only be true if they will be acting on the opinions that they get from their customers. 6.0 Conclusion The investigation that was carried out on the operations of Zoe’s Kitchen was evidently worthwhile.However, it is through this analysis that some of the areas that the business was not doing well in can be corrected. This helped in coming up with the recommendations that have been outlined herein. The recommendations include: increase in storage place, especially for food product; increase in staff size; introduction of new meals; more customer involvement; and price review. These recommendations are likely to improve the operations of the business if they are diligently carried out. 7.0 Bibliography Bhattacharyya, DK 2011, Performance management systems and strategies, Pearson, Dehli.http://proquest.safaribooksonline.com/?fpi=9789332503335. Bode, S 2003, Successful catering: managing the catering operation for maximum profit. Atlantic Pub.Group, Ocala, Fla. Bourne, M 2002, Strategy and performance, Cambridge University Press, Cambridge. BPMN 2010, Mendling, J, Weidlich, M &Weske, M 2010, Business process modeling notation second International Workshop, BPMN 2010, Potsdam, Germany, October 13-14, 2010 : proceedings, Springer, Berlin. http://dx.doi.org/10.1007/978-3-642-16298-5. Dugmore, J & Lacy, S 2005, Capacity management, BSI, London. Grover, V & Markus, ML 2008, Business process transformation, M.E. Sharpe, Armonk, N.Y. http://site.ebrary.com/id/10292185. Grummit, A & Van Bon, J 2009, Capacity Management a Practitioner Guide, Van Haren Pub, Zaltbommel. http://public.eblib.com/choice/publicfullrecord.aspx?p=516692. Johnson, RA, Newell, WT &Vergin, RC 1972, Operations management; a systems concept, Houghton Mifflin, Boston. Kachru, U 2007, Production and operations management: text and cases, EXCEL BOOKS, New Dehli. Kamauff, JW 2010, Managers guide to operations management, McGraw-Hill, New York. Lai, K-H, & Cheng, TCE 2009, Just-in-time logistics, Gower, Farnham, England. Lovelock, C. H., Wirtz, J., & Chew, P. (2009).Essentials of services marketing, Prentice Hall, Singapore. Mahadevan, B 2010, Operations management: theory and practice, Pearson, Upper Saddle River. Marchioni, F 2010, JBoss AS 5 performance tuning build faster, more efficient enterprise Java applications.Packt Pub, Birmingham, UK.http://site.ebrary.com/id/10438007. Mukherjee, PN &Kachwala, TT 2009, Operations management and productivity techniques, PHI Learning, New Delhi. Panneerselvam, R 2012, Production and operations management. Parker, DW 2012, Service operations management: the total experience, Edward Elgar, Cheltenham. Pycraft, M 2000, Operations management, Pearson Education South Africa, [Cape Town]. Scanlon, NL 2013, Catering management, Wiley, Hoboken, N.J. Shiring, SB 2014, Professional catering: the modern caterers complete guide to success, Delmar, Clifton Park, NY. Read More