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Meishkafadiah Alkaff

Mohammad Fardani Dzulhikam


Sandy Renaldy
Permada Wirapranata
• Type :Public (NYSE: DPZ)
• Founded :1960
• Headquarters Ann Arbor, Michigan
• Key people : Tom Monaghan,
Founder
David Brandon, Chairman & CEO
Industry Restaurants
• Products Pizza  · sandwiches  ·
pasta  · chicken wings · desserts
• Revenue ▲ $1.462 billion USD
(2007)
• Employees 145,000
• Website www.dominos.com
• Low Pay
• Part Time
• Closely Supervised
• “High Turnover”
• In the case of Domino’s Pizza
– Multitasking
• Main Problems
– Domino’s is Facing employee high
employee turn over rate
• Store Manager leave every 3 – 6 months
• Lower level employee turnover rate 300 %
– Company Policies avoid increasing basic
wage
• How they Handle the Problems
– Recruit better store manager by
implementing new test
– Improving employee skills by training the
weak points
• How they Handle the Problems (Cont.)
– Providing facilities for store to see
their records
– Better financial incentive
– Better improvement training
• Why is Domino’s Facing High
Turnover Rate ?
• What is the Impact of high
turnover rate to Domino’s
• Is it really effective not to increase
the basic wage oppositely like
starbucks does?
• What is really needed to reduce
employee turnover rate?
• Compatibility with they work reviewed
from their basic education, interest,
experience, compensation and any
others.
• The Amount of salary and fringe benefits
with any others benefit (career, training
& management development)
• Relationship between human either
vertical and horizontal (superior
treatment and relationship with
subordinate and colleagues).
• Low Pay (obvious)
• Lack of relationship between boss
and worker.
• Mean colleague + boring days
• Lack of leadership element (note
that store manager leave ever 3-6
months)
• Main Problems is : “Store
Manager”
• Opportunitis to get employee who’s have better
experience and ability
• Company can employ new employee who’s got
new idea’s yang memiliki ide-ide baru which can
create inovation in exist governace work
• Can decrease the average of employee work
period which can reduce the cost of salary that
must be paid.
• Can give a chance to talented and high
performance.
• If the employee who’s quit the job has a poor
performance or employee of a gadfly for the same
team working in the organization
• Employee Repo cost
• Learning cost
• What they out for worker are more less than
they get from new worker.
• Level accident new employees, usually tend
to be higher
• There is a production that has lost during
turnover
• Production equipment that cannot full
operate
• A lot of waste because of the new employees
Impact On Domino’s

• It’s cost money to recruit, hire, and


train people, and undercuts service
when inexperienced employees
don’t work as efficiently
• The Financial Cost is estimated as :

– $20.000 for each store manager leave


– $2.500 for each hourly worker leave
• Distinct characteristic of fast food
business were, high dependable on
low-paid workers. Small problem
could trigger worker to seek
another job in another company.
• Some company using approach of
giving high initial salary.
• Domino using different approach,
where they didn’t raise salary
• They believe working environment
and quality of store manager play
important role in turnover rate
• They believe when store manager
position turnover is high, it will has
ripple effect to the layer below
• So they try to focus on recruit high
quality store managers
• Domino’s is selectively hiring store
managers, train them, and
motivating them with rewards
• They coach and demand store
managers to create better working
environment
– Recruit Better Store Manager
– Give Store Manager Better Tools
– More Meaningfully Incentify Store
manager
• The Role of a Store Manager :
• better working environment
• To motivate other workers or
subordinate
• Increase job involvement among
workers
• The Role of a Store Manager :
• To create better working environment
• To motivate other workers or
subordinate
• To Increase job involvement among
workers
• Dimension
• 1. Extraversion : Outgoing, talkative,
sociable, assertive
• 2. Agreeableness : Trusting, good‐
natured, cooperative, softhearted
• 3. Emotional Stability : Dependable,
responsible, achievement oriented,
persistent
• 4. Emotional : Stability Relaxed,
secure, unworried
• 5. Openness to Experience :
Intellectual, imaginative, curious,
broad‐minded
• Recruitment
– Managerial and Financial Skill is
needed
– People Management
• Development
– To enhance managers weakness
which assessed during recruiting
process
– Continuous Development guided by
franchise owner or headquarters
Supporting Tools for
Manager
• Managers need to be equipped and
weaponized with better tools to provide
easier managerial handling on their
subordinate
• The weapon include :
– Better IT system
– Better FAQ system
– Better managerial control system
– Better business process/operational
efficiency
Supporting Tools for
Manager
• Computerized Tracking System
• FAQ Management
• Domino’s Pulse System
• Domino’s Next Generation Store
System
• New Domino Next Generation Store
System developed by Microsoft
Key Benefit of The system
• Total cost of ownership. The solution is
designed to lower the total cost of
ownership by delivering superior price
performance and reducing administration
cost
• Lower Risks. The solution is designed to
help address industry mandates and avoid
unnecessary risk and related costs
• Security. The solution is designed to
minimize risks, Microsoft is optimizing and
better securing solutions that reduce
complexity while supporting rigorous
service levels. The solution also monitors
fraudulent activity
Sustainable Incentive
Programs
• formal scheme used to promote or
encourage specific actions or behavior
by worker.
• The scientific literature also refers to
this concept as Pay for Performance.
• Domino’s is using the concept of
sustainable incentive to improve
worker’s job involvement
Incentive program
Type of Incentive :
– Employee Incentive
– Consumer Incentive
– Dealer / Channel Incentive
– Sales Incentive

Type of Reward :
– Cash Reward
– Non Cash Reward
– Non Monetary Reward
Rewards for Managers &
Employee
• Employee Stock Option Plans
Company introduced program that grants
stock options to about 15% of store managers
based on criteria such as sales growth and
customer services
• Suggestion Rewards :
– A simple ‘Thank You’ appreciation of good work
– Treat your employee with respects
– Start birthday program
– Have employee field trips
– Casual lunch with staff
• The result is significant: employee
turnover rate declined to 107%.
• Far below previous, and average
industry
• In case you
haven’t figure it
out : IT IS
GROWING
Framework

• How they handle the problems


– Recruit Better Store Manager
• Explain the importance of store manager
• Role model of store managers
– Give Store Manager Better Tools
• What effective tools
• How can the Tools Help
– More Meaningfully Incentify Store
manager
• Stock Option etc.